Win 2K8 R2 - Group Policy Management - Failed to Open Group Policy Object. You may not have appropriate rights. The network path was not found.

Question

New to Windows Server 2008 R2 Administration.
I setup this Windows 2008 R2 Server on a Dell 2950 Poweredge server and have been migrating users off of an old NT style domain running on Samba 3.6 on CentOS.
I have the domain setup (nicholas.sacredheartsaratoga.org), added users, and have moved users / computers over to the new domain and working.
When attempting to setup Group Policy Objects, I continually get the "Failed to Open Group Policy Object" Error.  This is driving me nuts and seems to be a 49 error.. which I have done a ton of research on but none of the suggested fixes seem
to be working.
I've been working at this for a couple of weeks and really need this fixed to be able to set GPO's correctly.
Here is my IPCONFIG /ALL
C:\Users\Administrator.NICHOLAS.000>ipconfig /all
Windows IP Configuration
   Host Name . . . . . . . . . . . . : NICHOLAS
   Primary Dns Suffix  . . . . . . . : sacredheartsaratoga.org
   Node Type . . . . . . . . . . . . : Hybrid
   IP Routing Enabled. . . . . . . . : No
   WINS Proxy Enabled. . . . . . . . : No
   DNS Suffix Search List. . . . . . : nicholas.sacredheartsaratoga.org
Ethernet adapter Local Area Connection 2:
   Connection-specific DNS Suffix  . :
   Description . . . . . . . . . . . : Broadcom BCM5708C NetXtreme II GigE (NDIS
 VBD Client) #2
   Physical Address. . . . . . . . . : 00-1D-09-27-F1-63
   DHCP Enabled. . . . . . . . . . . : No
   Autoconfiguration Enabled . . . . : Yes
   Link-local IPv6 Address . . . . . : fe80::542:43f2:2aaf:d903%13(Preferred)
   IPv4 Address. . . . . . . . . . . : 10.10.20.21(Preferred)
   Subnet Mask . . . . . . . . . . . : 255.255.255.0
   Default Gateway . . . . . . . . . : 10.10.20.3
   DHCPv6 IAID . . . . . . . . . . . : 301997321
   DHCPv6 Client DUID. . . . . . . . : 00-01-00-01-19-7D-DC-B6-00-1D-09-27-F1-61
   DNS Servers . . . . . . . . . . . : 10.10.20.21
   NetBIOS over Tcpip. . . . . . . . : Enabled
Tunnel adapter isatap.{41653A38-9372-4740-BB03-41950A9C9BC0}:
   Media State . . . . . . . . . . . : Media disconnected
   Connection-specific DNS Suffix  . :
   Description . . . . . . . . . . . : Microsoft ISATAP Adapter
   Physical Address. . . . . . . . . : 00-00-00-00-00-00-00-E0
   DHCP Enabled. . . . . . . . . . . : No
   Autoconfiguration Enabled . . . . : Yes
Tunnel adapter Local Area Connection* 9:
   Media State . . . . . . . . . . . : Media disconnected
   Connection-specific DNS Suffix  . :
   Description . . . . . . . . . . . : Teredo Tunneling Pseudo-Interface
   Physical Address. . . . . . . . . : 00-00-00-00-00-00-00-E0
   DHCP Enabled. . . . . . . . . . . : No
   Autoconfiguration Enabled . . . . : Yes

Answer 1

Will post the entire contents of my gpreport as soon as my account is verified... but this is the jist of the error being reported:
Component Status<v:group alt="Error" class="vmlimage" coordsize="100,100" style="width:15px;height:15px;vertical-align:middle;"><v:oval class="vmlimage" fillcolor="red" strokecolor="red" style="width:100px;height:100px;"></v:oval><v:line
class="vmlimage" from="25,25" strokecolor="white" strokeweight="3px" style="" to="75,75"></v:line><v:line class="vmlimage" from="75,25" strokecolor="white" strokeweight="3px" style="" to="25,75"></v:line></v:group>
Component Name
Status
Last Process Time
Group Policy Infrastructure
Failed
2/17/2014 2:50:06 PM
Group Policy Infrastructure failed due to the error listed below.
Logon failure: unknown user name or bad password. 
Note: Due to the GP Core failure, none of the other Group Policy components processed their policy. Consequently, status information for the other components is not available.
Additional information may have been logged. Review the Policy Events tab in the console or the application event log for events between 2/17/2014 2:50:05 PM and 2/17/2014 2:50:06 PM.
Registry
(N/A)
1/4/2014 1:45:29 PM
Security
(N/A)
1/4/2014 1:45:35 PM
User Configuration Summary