Shrinking A Log File Every Night

I have a relatively high usage 2005 database whose transaction log grows every day.

Untill now I have been manually shrinking the log files .. but I would like to automate this process.

In the maintenance schedule that runs every night

1 Do a full backup to disk
2. Do a transaction log backup to disk
3. run the following TSQL

USE [MyDB];
GO
ALTER DATABASE MyDB
SET RECOVERY SIMPLE;
GO
DBCC SHRINKFILE (MyDB_log, 3000)
GO
ALTER DATABASE MyDB
SET RECOVERY FULL;
GO

4. Backup disk files to tape.

however it doesn't work !! the TLOG file does not shrink, even though its the same as the manual job that I run?

There is nothing in the SQL logs .. but in the event log I get

Event Type: Error
Event Source: SQLISPackage
Event Category: None
Event ID: 12291
Date: 13/12/2007
Time: 00:50:10
User: NT AUTHORITYSYSTEM
Computer: ALGSQL1
Description:
Package "MyDB_FULL_BACKUP" failed.
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any ideas ?