I have had problems with directory names which include a space. Try the "short name" instead. You can use the /X option of dir to find it. It probably is PROGRA~1 for Program Files. Even if this 'works', I would consider it a debug aid, not a permanent fix.
UPDATE: Add example of using system with windows. I expect that it will run on most windows machines. It demonstrates how much the short names and forward slashes can simplify the quoting. The following example displays the perlmonks forum using Microsoft internet explorer.
use strict;
use warnings;
my $browser = 'iexplore.exe';
my $arg1 = 'http://perlmonks.com';
my $cmd;
$cmd = "C:/PROGRA~1/INTERN~1/$browser";
print "$cmd, $arg1\n";
print "hit any key to run command. Close IE to contine.";
<>;
system $cmd, $arg1;
print "Back again\n";
$cmd = "\"C:\\Program Files\\Internet Explorer\\$browser\"";
print "$cmd, $arg1\n";
print "hit any key to run command. Close IE to continue.";
<>;
system $cmd, $arg1;
print "Back again\n";