Network Account can't place items on desktop.

I am running Server 10.6. i have setup AFP service and Open Directory. I have created a sharepoint with automount enabled. I have set permissions on the folder according to the Server documentation for home folders. I have created a network account and set the home folder for this account to be located on the sharepoint. I have set the client computer to join the open directory so I can log into the network account.

I then log into the network account from the client. All seems well except when I delete a file. I get a warning that the file will be deleted immediately. If I say yes the file is deleted. Now if I log out and log back into the network account I can no longer place any items on the desktop. i get the prohibitory sign. Also if I click on a stack in the dock and then the show in finder icon in the stack the finder window does not open. In checking my home folder I have all of the folders (Documents, Download, Music, etc.) but the folders are drawn as plain folders. The usual icons that appear on the folders are missing.

If I log out and restart the client computer I can log back in again and all behaves well except I still get the waring dialog box when moving files to the trash.

What am I missing? Why would files want to be deleted immediately and why when I log out and then back in again I am not able to place anything on the desktop? Is there some setting I am missing on the client computer? What about settings on the server?

Thanks.--