I’m using 3ds Max Design 2012 (2013 is too buggy for me) and just upgraded to VRay 2.40.03. I have always used photometric lights (with vrayshadows) in the past I thought I would try the VRayIES. Due to my ignorance the VRayIES looks worse. I tried upping the shadow subdivisions to 32 with no luck.
Bingo! it worked. I guessed and added a zero in the cutoff value (changing it from the default of .001 to 0.0001)
Thanks!
cutoff - this parameter specifies a threshold for the light intensity, below which the light will not be computed. This can be useful in scenes with many lights, where you want to limit the effect of the lights to some distance around them. Larger values cut away more from the light; lower values make the light range larger. If you specify 0.0, the light will be calculated for all surfaces.