This works for me:
@echo off
set "fileiso=%~1"
set Exedir="C:\Program Files\OSFMount"
pushd "%Exedir%"
osfmount -a -t file -f "%fileiso%" -m #:
popd
pause
Output:
C:\Program Files\OSFMount
Creating device...
Created device 1: G: ->
D:\Old C Drive\Users\williamsonm\Downloads\clonezilla-live-20130314-quantal-i386.iso
Notifying applications...
Done.
Press any key to continue . . .