The default security policy on Windows 2003 Server is set to always encrypt network connections under all circumstances. Whilst this is fine for most clients (especially Windows clients, understandably), the version of SMB that Panther uses doesn’t support encrypted connections. Apparently this support exists in Samba 3, but not on the version OS X uses. The solution is to change the security policy to use encryption when it’s available and not otherwise. Here’s how.
From Administrative Tools, open Domain Controller Security Settings.
Go to Local Policies then Security Options.
Scroll down to find the entry Microsoft network server: Digitally sign communications (always). Set this to Disabled.
The only thing left to do is to reload the security policy, as changes don’t otherwise take effect for some time. Open up a command window and type:
gpupdate
Once you get the confirmation that the policy has been applied you should be all set.
Thanks to http://allinthehead.com/retro/218/accessing-a-windows-2003-share-from-os-xfor saving a lot of time.
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