Report Definition Error When Deploying Report To RS 2000 In VS .NET 2003

Using MS SQL 200 SP4 with Reporting Services 2000 SP2 on Win 2003 Server SP1

Visual Studio .NET 2003 on different PC (Win XP SP2)

No problem creating reports or building solutions.
Problems develop when deploying report to Report Server.

Here is the Output:

------ Build started: Project: From CD, Configuration: Debug ------

Build complete -- 0 errors, 0 warnings



------ Deploy started: Project: From CD, Configuration: Debug ------

Deploying to http://<server name>/ReportServer?%2f2nd
Deploying data source '/2nd/AdventureWorks2000'.
Deploying report 'Vendor Purchase Orders'.
The report definition is not valid. Details: Could not find schema
information for the element
'http://schemas.microsoft.com/sqlserver/reporting/2003/10/reportdefinition:Report'.
Deploy complete -- 1 errors, 0 warnings



---------------------- Done ----------------------

Build: 1 succeeded, 0 failed, 0 skipped
Deploy: 0 succeeded, 1 failed, 0 skipped

These are my first attempts using report services. In a previous deployment
attempts it created the folder (named 2nd), but in another attempt (saving it
to the existing folder) I got the same result as you see above (I have also
tried with a new folder but no luck). This above output is from my last
attempt.

The Build error Task List states:

The Report Definition is not valid. Details: Could not find schema
information for the element
'http://schemas.microsoft.com/sqlserver/reporting/2003/10/reportdefinition:report'.

The shema URL as above returns HTTP 404.
If I remove :report, I receive the page for Report Definition Language
Schema May 2004

Looking at the .rdl code the schema URL is as above without :report.

As you can imagine with a limited skill set in this area I am quite
confused. I have been doing alot of research but found nothing to help (or
that I understand will help) so far.

If anyone can help me get through this I would appreciate it.

Bill