>Have you just tried changing the user that the application runs as, instead of Network Service, have it run as a particular user?

That was what I going to do - use impersonation, but then I was able to get NETWORK SERVICE registered as a SQL Server login

> I haven't run into an problems w/ migratation from 2000 server to 2003 server.

Which you wouldn't if you're using impersonation or SQL Authentication.