Service program / Activation group problem

Dear All,

If anyone can offer an explanation (and advice!!) for the following problem I 
would be very grateful.  It relates to the use of service programs in named 
activation groups.  My situation is:

CL Pgm A - sets library list & calls RPG Pgm B
RPG Pgm B - calls various programs, including a CALLB to RPG Module C
RPG Module C - uses procedures defined within Service Program D
Service program D is a group of procedures/functions. There is no mainline 
code. The service program uses a named activation group.

Programs A and B run in the default activation group.
Service Program D runs in its own named activation group.

My problem is when the user executes the function the first time, all works 
well. However if the process returns to CL Pgm A, to set/reset library list, 
the named activation group for the service program D is deleted.

If the user subsequently calls Pgm B to repeat the same process, the job 
terminates abnormally with a MCH3402 message.

The point where this seems to happen is the point in the module C where it 
references a sub-procedure contained within the service program D.

The module C uses two files and sets on LR before it returns.

For RPG PgmB it doesnt seem to matter whether INLR is ON or OFF, the problem 
still happens.

I hope I've covered everything !  I am a bit stumped as to what to do next.

Rgds
Nigel