http://bugs.winehq.org/show_bug.cgi?id=14965
--- Comment #5 from Vincent Povirk madewokherd@gmail.com 2008-08-24 11:23:52 --- It's not a Windows bug. If anything it's a bug in the application that it is sensitive to the working directory. The wine command passes the working directory as-is to the program, like the windows command line, and this is not going to change.
If you want to match the Windows GUI behavior, what Diablo probably expects, methods are provided for that. Use the shortcuts Wine set up when you installed the program (which you can take apart to see how to do the same thing in the command-line) or double-click on the exe file (which runs 'wine start /unix unix-path-of-file').