Hi there,
Not sure about your security situation but it probably has something to do with not being on a domain.
RSScripter is another method for deploying reports that is useful for disconnected environments.
It has a command-line tool for deployment. Since this tool uses the web service, it may spit out additional details that BIDS doesn't if it encounters any problems.
http://www.sqldbatips.com/showarticle.asp?ID=62
Otherwise it can be placed on the production server and then run directly against Reporting Services from there.
cheers,
Andrew