Hello again. Your issue is being caused by the Canon driver. They have not been designed to function when the printer is connected to the USB port of a third-party print server. Note they do work when connected to the USB port of an Apple Airport device, like the Express.
But rather than replacing the Dlink print server with an Airport Express, you can simply use an alternate printer driver such as Gutenprint. After you download and install the Gutenprint driver, follow the procedure you have used already - although you may need to check the Dlink documentation regarding the queue name. Not sure that it would be i960, unless you manually entered this information via the Dlink configuration menu.
With the correct queue information, the last step is to select the i960 driver that shows Gutenprint as part of its name in the Print Using menu.
Thank you, PAHU, this solved a problem I've been having for quite a while.
I have a Canon Pixma iP4200 connected to a DSL router (an SFR Neufbox 4, issued here in France by the operator SFR). With OS 10.6 on my daughter's MacBook Pro, connecting to the printer through the print share function on this DSL router worked fine using the printer drivers supplied through Canon and Apple. Then when we got an iMac with 10.7, impossible to get it to work. I had exactly the error shown by louiema above.
But now that I installed Gutenprint 5.2.9, I was able to configure the connection instantly, and now I can move my printer back where it belongs, and not have it sitting on the floor beside my desk.
Brilliant ! Thank you so much for sharing your experience. I will now share this solution with my francophone community.