Cannot copy local profile to network profile

I have just setup an Active Directory Domain with Windows 2003 server.
Created user accounts and successfully logged into Domain from XP and 2K
workstations.

I tried to copy the local user profile over the Domain profile, like I have
done a lot, but get the following error message.

Windows cannot copy file C:\Documents and Settings\PetersonK\Start
Menu\Programs\ACT! 2005 to location C:\Documents and
Settings\PetersonK.SCH-I\Start Menu\Programs\ACT! 2005 . Possible causes of
this error include network problems or insufficient security rights. If this
problem persists, contact your network administrator.

DETAIL - The system cannot find the file specified.

I logged into the workstation with Domain Admin account. I have tried
changing user rights, Admin account taking ownership, etc. but still get the
same error.

All XP's are SP2, 2003 DC is patched current, and 2K Workstations patched to
currend.