SQL Cluster Setup Fails After Installing Service Pack 2

We have successfully been using MSCS with MSSQL7 (SP1) running under NT4 EE
(SP6a), installed in an active/active configuration using, two DELL
PowerEdge 6350 machines. Recently I installed MSSQL7 (SP2), I followed the
instructions that came with SP2, and unclustered the SQL nodes using the
Failover Cluster Wizard, and installed SP2, this was uneventful, and
appeared to install correctly. Next I tried to recluster the SQL nodes
using the Failover Cluster Wizard as directed. This failed with: "Could not
run setup on remote machine. SQL Cluster Setup failed." So I began the
usual research using the usual resources, and have found articles that
discusses this error, and the things to look for when it happens. I have
exhausted all suggestions without success. I appear to have everything
correctly configured. I have enabled Cluster Logging (level 3), following
are the two things I have found that indicate something is wrong:

1. In the SQL Error Log the following gets logged when I run the wizard:
"Attempting to initialize Distributed Transaction Coordinator."
"Failed to obtain TransactionDispenserInterface:
XACT_E_TMNOTAVAILABLE"

2. In the Cluster Log I see the following message repeatedly:
"[ClRtlCopySecurityDescriptor] MakeSelfRelativeSD failed,
0x00000551"

3. In the sqlclstr.log I see the following, without an indication of
which file is missing:
"[reghelp.h:235] : 2 (0x2): The system cannot find the file
specified."
"[clushelp.cpp:166] : 259 (0x103): No more data is available."
"[validate.cpp:147] DeleteTestGroup:OpenClusterResource: 5007
(0x138f): The cluster resource could not be found."
"~~~ XXX InstallRemote failed"

Does anyone have any ideas about what could be causing this problem?
Many thanks in advance.

Christpher Cutts
LifeMasters Supported SelfCare