Terminal Server domain functions not available in SBS 2003 domain

I have a SBS 2003 R2  in a domain, next to that I've installed a 2003 R2 Standard server next to it in the same domain as a terminal server added lics etc.

The strangest thing is that I can't add users to the remote desktop users group on the TS.  The domain location is unavailable.

Perhaps I've overlooked the obvious.

The server is visable in the servers list of the SBS mangement console. Also I can login using domain credentials.

I've removed the server twice from the domain and added it again, but no luck. Both machines are fully patched.

Thanks in advance.
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Hello servitinfo,

Did you add the server the correct way via http://server/connectcomputer ?
please follow this guide: http://www.smallbizserver.net/Default.aspx?tabid=266&articleType=ArticleView&articleId=175
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Likely incorrect DNS settings; make sure your terminal server uses *only* your SBS as DNS (and that the SBS uses only itself as well; configure forwarders to point to your ISP's DNS). Do not enter any external DNS servers in the TCP/IP settings on any domain member.
servitinfoAuthor Commented:
It was a DNS problem indeed. Using http://server/connectcomputer/ as suppsaws suggested gave the error away.
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