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This is typically how it happens:<br />
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I just solved an identical problem to this a few days ago here is the link: <br />
<a href="https://www.experts-exchange.com/topics/comp/os-ms-windows/setup/nt/Q.10094730" rel="ugc nofollow">https://www.experts-exchange.com/topics/comp/os-ms-windows/setup/nt/Q.10094730</a>&nbsp;<br />
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Here was my answer: <br />
I had the exact problem last week. Reinstall service pack 4. The reason this happens is that the server service srv.sys was not on the hard drive until you added networking. if you run service pack 3 (4 is out now so you might want to use it instead) it will put the updated srv.sys on the hard drive. <br />
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I know you installed service pack 3, but just try running update again. you probably have the wrong version of srv.sys <br />

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This is typically how it happens:

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I just solved an identical problem to this a few days ago here is the link:
https://www.experts-exchange.com/topics/comp/os-ms-windows/setup/nt/Q.10094730 [https://www.experts-exchange.com/topics/comp/os-ms-windows/setup/nt/Q.10094730] 

Here was my answer:
I had the exact problem last week. Reinstall service pack 4. The reason this happens is that the server service srv.sys was not on the hard drive until you added networking. if you run service pack 3 (4 is out now so you might want to use it instead) it will put the updated srv.sys on the hard drive.

I know you installed service pack 3, but just try running update again. you probably have the wrong version of srv.sys


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The Server service failed at startup, with the error message: There is not enough servercapacity to run this command<br />

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The Server service failed at startup, with the error message: There is not enough servercapacity to run this command


Server Service problem on NT4.0 wkst

This topic area includes legacy versions of Windows prior to Windows 2000: Windows 3/3.1, Windows 95 and Windows 98, plus any other Windows-related versions including Windows Mobile.