From Oracle Support:
PROBLEM: I get an ORA-03539 or ORA-03520 or ORA-06401
1. Make sure your "ORACLE Settings" file is at the top-level of the System Folder, not in the "Extensions" folder.
2. Make sure your Oracle Home is set correctly. You do this by running either the "Set Oracle Home" or "ORACLE Installer" applications. When setting the home folder, open the Oracle folder and click on the "Set Home" or "This is the Oracle Home Folder" buttons. You know you have opened up the right folder when the folders listed in the box are folders like "Database", "Drivers", "Applications", etc.
3. Also make sure the "net_tcp" file is in the "Drivers" folder. If it is not, then see INSTALLING SQL*NET.
4. Use the t:ipaddress:SID syntax, don't use an alias or hosts file until you get it working. Remember that the "@" symbol is not needed if you are using OracleCard or HyperCard! The one thing you can't give for your heart's desire is your heart. - Lois McMaster Bujold