Can create 52 publication, but creating 53rd leads to problems

Question

Hello,
My apologies in advance for a long post, but I was really trying to make sure I do my due diligence before turning to the community for help, so here it goes.
I am working on a proof of concept with the purpose of using transactional replication to maintain a "reporting" copy of our databases. 
The setup will include a "Publisher" server and a separate "Subscriber" server.  The replication will be a "Pull" transactional replication with a distributor running on the Subscriber server. Once again: Publisher =>
pull => (Distributor + Subscriber)
We expect to have a lot of databases on each of our servers, so, in order to mimic this scenario, I restored 100 databases (about 1 GB each) on
the publisher.  All of the databases are identical.
I wrote a script, which enables me to setup replication in an automated fashion (since obviously I don't want to do it manually dozens of times). 
The script performs the following steps:
1. Enable replication for a database (if not enabled already):
2. Create logreader agent for a database
3. Create publication for a database (if doesn't exist)
4. Create snapshot agent for a database (don't run it yet)
5. Add articles to the publication
6. Run snapshot agent job (and wait for it to finish)
7. Create subscription database (if it doesn't exist)
8. Add subscription in the subscription database (if it doesn't exist)
9. Create distribution agent
I am able to successfully setup replication for about 52 of my databases and everything is running fine. 
When I get to #53 things start to go wrong.  The snapshot creation is successful, but the logreader and the distribution agents fail.  Moving on to #54 everything is now completely broken.  The snapshot does not get created and none of the agents
are running.  I have carefully reviewed replication monitor and SQL Agent jobs looking for error messages, but didn't find anything helpful.  The replication monitor simply says: "Agent Shutdown. 
For more information see the SQL Server Agent job history for job ‘….correct job name here…’". 
In the details it says: "The replication agent encountered a failure. 
See the previous job step history message or Replication Monitor for more information". 
Next I go to the SQL Agent Jobs and review the output. 
In the job history the failed step says: "Message : The replication agent encountered a failure. See the previous job step history message or Replication Monitor for more information".
 In turn, the previous step has no info at all. 
Just the word “Message” with nothing after that.  I have also reviewed the windows application log for any errors, but it simply repeats the same messages I see in the replication monitor and agent job history. 
I added “–output” parameter to the agent command (in the job step properties) hoping that the output file would provide me with more information, but no output file gets created, which leads me to believe that the agents don’t even start.
I was thinking that I might have hit some hardware limit, so I checked the disk space and there is plenty of it available.  I have also checked RAM and it's not even 50%
used.
Finally, what really gets me is that I am able to run all of the agents manually from the command line. 
For example, I can copy paste parameters from the SQL Agent snapshot job and run snapshot.exe from the command line with these parameters – the snapshot gets created successfully. 
The same goes for logreader and distribution agents.
I am completely confused here and appreciate any pointers in the right direction.
Final note (and maybe the only silver lining): The problem is fully re-producible. 
I can successfully setup my 50+ subscription and then the issues will always start around subscription number 52-53.
Thank you!

Answer 1

Answering my own question here.  The solution was given to me by Brandon Williams of http://www.sqlrepl.com.  I was hitting a Windows limitation related to the use of "desktop heap".  The problem is described here: http://support.microsoft.com/kb/949296
and the work-around is given here: support.microsoft.com/kb/824422. 
Note that while the KB articles refers to WindowsNT and SQL Server 7.0/2000, it certainly applies to the latest versions as well. In my case I am running Windows 2008R2 Server and SQL Server 2012