I am having an issue where any new user I create on Server Standard 2003 gets the error "the local policy of this system does not allow you to log on interactively" when they try to logon locally.
I compared group memberships with accounts that work correctly and they are the same. I verified that the default domain policy has the logon locally setting as not defined. However even when I do define it for "everyone" they still cannot logon.
The only workaround for this seems to be if I add the user as a domain admin.