What backup are you restoring? Use the TAKEN AT clause to specify the backup's timestamp.
Specify the same directory in FROM as you used in the BACKUP ... TO .... "On OS/2 or the Windows operating system, the specified directory must not be a DB2-generated directory." I don't know if the direction of the slashes is significant.
You can use INTO target-database-alias to create the database during the restore.
The V7 RESTORE description has the comment "[t]o restore a database that was backed up on a different workstation platform, use db2move - Database Movement Tool." I don't know if you fall into this category.