Verification of replica failed. The forest functional level is Windows 2000

I have a Server 2008 Standard sp2. This is a non R2 server. I have a Server 2012 Essentials that im trying to make the PDC, but I get this error when trying to make it a DC.

"Verification of replica failed.  The forest functional level is Windows 2000.  To install Windows Server 2012 domain or domain controller, the forest functional level must be Windows Server 2003."

However, when I go check the functioning level it is at 2008 level.
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DrDave242Senior Support EngineerCommented:
Are you sure you're checking the correct functional level? There are two: the domain functional level (DFL) and forest functional level (FFL), and they don't have to be equal (though the DFL can't be lower than the FFL). The DFL is changed via Active Directory Users and Computers, but the FFL is changed via Active Directory Domains and Trusts, as shown here:

May as well have another look, just to be sure.
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