Remote Desktop does not connect

Hi All,
I have just built an image for some new machines that I plan on rolling out to my users.  After I rolled out my first one, I ran into a problem.  A user tried to connect to this desktop using remote desktop and couldn't.  There are no errors displayed on the screen, it just does nothing.  I click connect, put in my credentials and click connect.  After a few seconds of the buttons being greyed out, the buttons just come back and nothing happens.  

I have been looking around for a while and found some people with similiar problems, but their fixes did not help.  Here's a list of what I have tried:

1)  Reboot - didn't help
2)  SFC /scannow - didn't help
3)  Install the remote desktop version 6 download from MS (KB925876).  didn't help
4)  Uninstalled this patch, then reinstalled again - didn't help
5)  Uninstalled anti-virus software - didn't help
6)  Uninstalled windows defender - didn't help
7)  made sure the windows firewall was turned off  - didn't help

Here's some more info:

1)  I can telnet to that machine on port 3389 (I found someone who said this is the port that RDP listens on)
2)  I did a netstat -a and port 3389 shows LISTENING
3)  I can rdp out to other machines
4)  This is a brand new build with all MS patches applied
5)  In the system applet - remote tab both check boxes are checked and domain users are in that group.

In the event log, I get no errors, only an informational message that states:
Event Type:      Information
Event Source:      Application Popup
Event Category:      None
Event ID:      26
Date:            2/1/2008
Time:            12:50:55 PM
User:            N/A
Computer:      XXXXXXXXX
Application popup:  : \SystemRoot\System32\RDPDD.dll failed to load

For more information, see Help and Support Center at
0000: 00 00 00 00 02 00 6c 00   ......l.
0008: 00 00 00 00 1a 00 00 40   .......@
0010: 17 00 00 c0 6c 02 00 c0   ...Àl..À
0018: 00 00 00 00 00 00 00 00   ........
0020: 00 00 00 00 00 00 00 00   ........

Can anyone help me figure this out?  

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try using tightvnc and see if you experience the same thing
ScottbemAuthor Commented:
I can connect with tight VNC
It has to do with the Display drive on the target box.  You may want to either update the driver or roll it back.  Here are some details on the error.

Here they eventually start talking about the display driver.

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ScottbemAuthor Commented:
This got me thinking in the correct direction.  Turns out it was in fact the display driver.  I tried uninstalling it to see if it would use the windows version, but that didn't work.  So, then I went to the ATI website and downloaded the latest version.  It was released Jan 18, 2008.  This fixed the problem.  

How weird.  BTW, it is an ATI Radeon HD 2400 PCIe video card.
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