Yesterday I needed to install Oracle 10g client on my desktop to talk to a 10g server located within a VM. I did something wrong during the installation and needed to re-install (twice in fact!). Once I installed correctly (so I thought), I attempted to connect to the server but was faced with an obscure NLS error. I believe the error was ORA-12705 - invalid or unknown NLS parameter value specified. I could find very little help on the web as to how to fix this problem. There were plenty of articles, I just couldn't find one that fixed MY problem.
Eventually I stumbled upon a thread that talked about modifying the system's PATH variable to remove the previous install's modifications. I guess when Oracle 10g client is installed it adds to the path something like "c:\oracle\product\10.2.0\client_1". Subsequent installs just increments the client_2, client_3, etc. Well after my last good install, I was using "c:\oracle\product\10.2.0\client_3" but the path included references to "c:\oracle\product\10.2.0\client_1"and "c:\oracle\product\10.2.0\client_2". All I had to do was remove the paths to client_1 and client_2 and my problem went away. Hope this helps.
Yes, the Oracle client installation does add its "bin" directory in front of the machine's path. You can use Oracle's "Universal Installer" application to change what is in the path instead of editing it manually.
This is also useful when you have more than one valid install of the client, let's say 10g and 11g for example. Before using an application that needs the oracle client, you must edit the path to point to the correct client (unless that application has its own setting for the oracle client location).