Cant raise domain functional level to 2003

I am attempting to raise the domain functional level but keep getting the following error.

The functional level could not be raised. The error is: The server is unwilling to process the request.

There have been several server crashes before I arrived and several were left in AD. Also there have been several DC running win 2000 that were demoted. I have used the metadata cleanup per the MS knowledgebase article and I have cleaned up DNS. Below is the event log from the server.

Event Type:      Warning
Event Source:      NTDS General
Event Category:      Directory Access
Event ID:      1723
Date:            4/20/2010
Time:            2:51:39 PM
User:            mydomain\user
Computer:      server
Active Directory failed to raise the functional level of the domain or forest because the following domain controller is at a lower functional level.
Object (forest or domain):
NTDS Settings object of domain controller:
CN=NTDS Settings,CN=LostAndFoundConfig,CN=Configuration,DC=mydomain,DC=us

The lost and found folder is empty when viewed from AD and from ADSIEdit. Any ideas
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Amit BhatnagarSystems Development Principal - Security and InfrastructureCommented:
Can you run a DCDIAG on the Server and post the result as an attachment. Please do not paste the output directly as it would be pretty long.

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DrDave242Senior Support EngineerCommented:
Are you sure you checked the LostAndFoundConfig folder, and not just LostAndFound?  They're two different containers in two different locations.
mikegaston3127Author Commented:
Found own solution thatks for the help.
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