Does it progress past the connection error? If so it might just be a timing issue.
Please remember to click “Mark as Answer” on the post that helps you, and to click “Unmark as Answer” if a marked post does not actually answer your question. This can be beneficial to other community members reading the thread. ” How to ask a question that is fixable.
I actually ran into this issue a few months ago. After beating myself senseless trying to figure out why I was receiving this error - - it turned out it had nothing to do with credentials. It was connectivity between the client and deployment server. I found our DHCP server was at capacity with its IPv4 addresses. When I would PXE boot the machine would be assigned an IP address (lets say .202). However, when WinPE would load and would attempt to start the Wizard that address was already in use according to the DHCP server so there was a conflict. Once I made room for machines to get a clear DHCP address everything started working again.
If you would like to test my suggestion when you receive this error push F8. This will open a command prompt. Try to ping your deployment server IP. Alternatively you can run an IP config and see if the client is getting an address at all. This may have nothing to do with your environment or your problem but it was how I found my way through this message.
Hope this helps.
- Proposed as answer by Dan McClurg Monday, June 03, 2013 3:57 PM