Group Policy Error for Local Computer policy, Access is denied for Administrator??

We have a Windows 2003 server on which we had to setup a few users with very limited access rights such as, no access to Start Menu, no access to creat folders on the desktop or right-click etc. They are only limited to 1 application. I did that by logging on as one of the users, creating a Group Policy object and saving the file as Console1.msc. Then I logged back on as Administrator, moved the Console1.msc from that user's desktop onto my own. I was able to access it once I changed the Security Permissions and gave myself Full Control rights. However then all of a sudden I started seeing this error message each time I would try to open the file.
Group Policy Error: You do not have permissions to perform this operation. Access is denied.
I checked the file and Administrators have full control.
And now it doesn't end there. Even if I try to run gpedit.msc from RUN I get the same error.
Also when I try adding the Group Policy Object snap-in in MMC I get the exact same error message while logged in as the Administrator or any other administrator accounts.Start Free Trial