By default, DOS has a small amount of environment space for settings, switches and variables - only 256 bytes. As you add more of these, it gets used up until it's gone; when that happens, no more batch variables can be processed and you only get this on-screen message:
Out of environment space
I found this out back in 1997 when I got my first Voodoo 1 card and tried to add 3dfx environment variables in autoexec.bat; none would work, and I had no idea why until I forced autoexec.bat to pause at the end - and saw this error message. I grabbed my DOS 6.2 manual and found the section about environment variables and how to increase its space to allow more to be added. The manual also said that a long PATH statement can also use up environment space.
Here is a link to a Google Books entry from "Using MS-DOS 6.22" that has a similar explanation:
https://books.google.com/books?id=u7oN-5y7nGs … 20space&f=false
What probably happened to the PC that has your GUS Classic is that you added/modified a batch setting, switch or variable that used up your current environment space and therefore no more batch variables could be processed; this means that your Ultrasound DOS variable was not really present, and some games require it to find your GUS sound card. When you moved your batch file call for the GUS to the top of autoexec.bat it was processed and added since there was environment space available - and the games that couldn't find the GUS suddenly found it again. Increasing environment space with the SHELL command in config.sys is one of the ways to correct this, but you have to be mindful of how much to add - an equal amount of conventional memory gets reduced with each increase you make.