cannot configure windows service identity on sql 2005 on server 20

[markm75]

I'm trying to finish off a dpm 2007 setup.. dpm setup bombs at the end,
complaining about a problem with reporting services (sql was pre-installed
per their documentation).. the problem in the log appears that the currently
logged in (domain admin) user account, doesnt have enough rights for dpm to
configure reporting services.. which seems to be related to the fact that if
i manually try this, from the reporting services configuration tool for the
windows service identity, i cant escape the red checkbox (x)..

I had setup reporting services with the default configuration during sql
2005 setup, but set the service to run under the network service account..

If i try to switch the windows service account name to local system or
toggle it back to network service.. it rolls through the first 3 checkboxes
up to creating a grant rights script for xxxx.. but then fails (it will pop
up asking for either sql authentication or integrated.. i cant seem to use SA
for sql and it will fail eventually, on the current user account)..

Error is "the reporting services rights were not applied properly, user may
still not have appropriate access to the reporting services resources".

I'm at a loss here..

I've even gone into the main area of sql database studio and given full
sysadmin rights to my currently logged in user and made sure the SA account
had full rights too..

I have things at sp2 level as well..

Any thoughts out there?