To address the initial problem with perhaps a silly question - does the user have write access to the vpnprofilename.pcf file? I was successful using the cli w/ the 4.6.03.0021 client on XP SP2 and noticed from the Cisco docs and in watching the timestamp that this file is mod'd at execution. Also, if the user/password combo are wrong, the dialog box pops up, however, I'll assume that this is not what's tripping up the client.
in reply to Windows Expect?
Anyway, if you are unsuccessful, for whatever reason, on the cygwin/io::tty route, perhaps something like AutoIt3 would help out (it allows scripting of mouse/keypress events). YMMV, of course, depending on organization constraints.