  This paper addresses several unsettled issues associated with string creation
in systems of orthogonal Dp-D(8-p) branes. The interaction between the branes
can be understood either from the closed string or open string picture. In the
closed string picture it has been noted that the DBI action fails to capture an
extra RR exchange between the branes. We demonstrate how this problem persists
upon lifting to M-theory. These D-brane systems are analysed in the closed
string picture by using gauge-fixed boundary states in a non-standard lightcone
gauge, in which RR exchange can be analysed precisely. The missing piece in the
DBI action also manifests itself in the open string picture as a mismatch
between the Coleman-Weinberg potential obtained from the effective field theory
and the corresponding open string calculation. We show that this difference can
be reconciled by taking into account the superghosts in the (0+1)effective
theory of the chiral fermion, that arises from gauge fixing the spontaneously
broken world-line local supersymmetries.
