Remember that a CGI script runs on the Web
server, so if you succeeded, every time a client visited
myfile.cgi a copy of Notepad would pop up on the server. I suspect this isn't what you want, and making Notepad run on the client's computer from a regular Web page isn't possible; it would be a security risk. You'd have to use ActiveX or Java and really loosen the security settings to allow this.
If you do want this to start up on the server, I believe the problem is the display, though I'm no Windows expert. IIS doesn't have permission to open up windows on the display of the currently logged-in user, so interactive programs like Notepad can't work, but non-interactive programs should work OK.