In the first bit of your post it sounds like somebody had already configured a "Restricted Groups Policy" for the "Remote Desktop Users" group, which explains why it "emptied out". That's not a stock OS feature-- somebody configured that at some point. You got around it by either modifying the GPO that was "emptying out" the group, or by making a new GPO that applied after the existing "Restricted Groups"-containing GPO to override the setting.
The next bit-- the "You do not have access to logon to this session" bit is a bit more confusing. I've been trying to repro it on a Windows Server 2003 SP2 32-bit Std. machine for a bit now, and I can't come up with a repro condition.
If you would, open the "Terminal Services Configuration" tool on the machine, highlight the "Connections" node in the left pane, and bring up the "Properties" of the "RDP-Tcp" object in the right pane. Have a look at the "Permissions" tab and see that "Remote Desktop Users" is granted "User Access" and "Guest Access" (the stock permission).
Failing that, I'm not sure w/o being able to repro it. What service pack level are you running of W2K3?
(BTW: I've got a similiar background to you-- I started on Unix and moved over to Windows grudgingly. Group Policy is incredibly useful once you get over the quirks. I script Windows machines like a mad man because I can't stand to do the same work more than once. The built-in Windows command shell is utterly inferior to any Unix shell, but it can be coaxed into performing most tasks...)
Edit:
Oh-- they're Windows XP machines. I didn't realize that. That changes things. I thought these were servers you were trying to access w/ RDP.
My psychic powers say that you're seeing the "You do not have access to logon to this session" message because there is someone already logged-on to the PC and the user logging-on with RDP doesn't have "Administrator" rights on the Windows XP machine. Windows XP can only host one RDP / console session at a time, and if someone is already logged-on only an "Administrator" user can remotely "bump them off" with RDP. All other users attempting to logon w/ RDP will receive the message you described above.
How does that look?
To investigate the "Restricted Groups" policy more, run the RSoP tool on the WinXP clients and see if there are any GPOs enforcing a "Restricted Groups" setting on "Remote Desktop Users". In a network I setup, for example, there would be. It's a common way to grant groups access to RDP on clients.
To add the user jscott to the group Remote Desktop Users:
net localgroup "Remote Desktop Users" jscott /ADD
If you're in an Active Directory domain environment, you can simply add a domain group (e.g., "Desktop Remote Users", or the like) to the local Remote Desktop Users group. Have a look at Group Policy Restricted Groups to manage these memberships. You can then manage the members of the domain group without having to update the workstations.
If the local group is missing, you will need to recreate it and assign it permissions. Create the group NET LOCALGROUP "Remote Desktop Users" /ADD, then open the local security policy editor secpol.msc and grant the group "Allow log on though Remote Desktop Services". You can also do this via Group Policy in a domain environment.
I would be curious to know how this group disappeared, if it was not just deleted. Perhaps another SF'er will know.
Best Answer
I am assuming that
ToolUsersis a local group on the Windows 7 PC. Local groups cannot be nested within local groups in Windows 7 (or, indeed, any prior version of Windows). It's just a limitation of the product's design.If you can't handle just putting users in both groups you could attempt to modify local security policy to grant the same user rights to your
ToolUsersas is already granted stock toRemote Desktop Usersbut, personally, I'd just put them in both groups.If you have an Active Directory domain you can make
ToolUsersa domain Global Group or Universal Group and nest it into the Windows 7 computer's localRemote Desktop Usersgroup.