Usually panoramas are made by stitching images and any image stitching program not only assembles images but also projects them using a mathematical transformation algorithm.
Pano2exe projects the image as if onto the inside of a cylinder (cylindrical projection). However if extremely wide angle lenses or if the panorama includes long right lines (like near side roads or walls) the image may appear distorted.
This mean that Pano2exe should not be used to view spherical images.