I have a single server W2K domain, and I installed Exchange 2003 Server on a new box, along with Exchange 2003std.
I can view Active Directory users and computers from the 2003 box, and I see everyone there and I can enable Exchange mailbox functions.
However, on the PDC/Forest Root W2K server, I do not see any of the Exchange roles to setup for those users and likewise I get the "cannot resolve..." errors if I try to configure for Exchange from a client PC in the domain.
It sounds like you have not performed the DOMAINPREP process in your root domain. To resolve this problem, put the Exchange CD into the CD drive on a domain controller in your root domain. Then, navigate to a command prompt at the directory on the CD containing setup.exe and run SETUP.EXE/DOMAINPREP. Once this process is complete, you should be able to manage Exchange objects in your root domain.
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