OS Error 5 during initial snapshot

I'm trying SQL Server replication for the first time. I have read a lot of posts on several forums and gone through Microsoft knowledge base articles and books online.

I have SQL Server Evaluation edition running on one Windows XP machine. (server)

I have MSDE 2000 on another Windows XP machine. (subscriber)

Both have Service Pack 3.

I have setup a publication on the server and have successfully created a pull subscripton on the subcriber.

I have a domain user account with admin privs on the server machine that is used as the SQL Server account login and SQL Server Agent login.

I have setup the ..MSSQL\REPLDATA directory as a public share and given the SQL Server Agent Account full permissions and privs - per MS KB#240688

When trying to synchronize my pull subscription I STILL get the error below.

What gives? I'm pulling out my hair now. This is obviously a permissions problem but I can't for the life of me figure out who needs what permissions and where.

Does the subscriber have to have a domain user account for anonymous subscriptions?

PARTIAL ERROR MESSAGE FROM LOG FILE:

The schema script '\\MyServer\Repldata\unc\MyServer_testdb_Lookups\2 0031210105855\PARM_LIST_1.sch' could not be propagated to the subscriber.
[12/10/2003 11:13:34 AM]E39726.test1: {call sp_reinitmergepullsubscription (N'MyServer', N'testdb', N'Lookups', 'FALSE')}
Reinitialized pull subscription to publication 'Lookups' from publisher 'MyServer:testdb'Percent Complete: 0
The subscription has been marked for reinitialization. Reinitialization will occur the next time you synchronize this subscription.
Percent Complete: 0
The schema script '\\MyServer\Repldata\unc\MyServer_testdb_Lookups\2 0031210105855\PARM_LIST_1.sch' could not be propagated to the subscriber.
Percent Complete: 0
Category:NULL
Source: Merge Replication Provider
Number: -2147201001
Message: The schema script '\\MyServer\Repldata\unc\MyServer_testdb_Lookups\2 0031210105855\PARM_LIST_1.sch' could not be propagated to the subscriber.
Percent Complete: 0
Category:AGENT
Source: E39726
Number: 0
Message: The process could not read file '\\MyServer\Repldata\unc\MyServer_testdb_Lookups\2 0031210105855\PARM_LIST_1.sch' due to OS error 5.
Percent Complete: 0
Category:OS
Source:
Number: 5
Message: Access is denied.Does your subscriber has enough previlege to access the publisher and the publication?|||Originally posted by joejcheng
Does your subscriber has enough previlege to access the publisher and the publication?

Maybe this is where I need the help. As far as I can determine my subscriber can access the publisher and the publication. As I read through the log of the sycnchronization steps I see

Connecting to subscriber
Connecting to distributor
Connecting to publisher
Retrieving publication information
Retrieving subscription information

All of these steps complete with no error I only get the error when the synch job starts to read the snapshot files

I can get to the files from the subscription PC, I can even copy them, open them, delete them. I don't know what gives.|||Originally posted by joejcheng
Does your subscriber has enough previlege to access the publisher and the publication?

Maybe this is where I need the help. As far as I can determine my subscriber can access the publisher and the publication. As I read through the log of the sycnchronization steps I see

Connecting to subscriber
Connecting to distributor
Connecting to publisher
Retrieving publication information
Retrieving subscription information

All of these steps complete with no error I only get the error when the synch job starts to read the snapshot files

I can get to the files from the subscription PC, I can even copy them, open them, delete them. I don't know what gives.