AD login = fine OD login = FAIL, why??????

I have been working on "the Magic Triangle" setup with a Win 2k8 server and an OSX 10.5 server (both fully patched up to date) and for the most part it has been text book and gone according to plan.

I can log into a mac locally, i can log into a mac using an AD account but where i am hitting a wall is the logging into a Mac using an OD account.

I get the following in the Password service server log:

Mar 16 2011 17:14:50 RSAVALIDATE: success.
Mar 16 2011 17:14:50 AUTH2: {0x4d7e34d803f6e3d10000000a0000000a, jdoe} DIGEST-MD5 authentication succeeded.
Mar 16 2011 17:14:50 RSAVALIDATE: success.
Mar 16 2011 17:14:50 AUTH2: {0x4d7e34d803f6e3d10000000a0000000a, jdoe} DHX authentication succeeded.

I am running out of ideas on what to do, I have trawled the forum and checked all the possible solution yet still can't log in.

Any suggestions welcome =)