samba - Mar 1998 - security = server, password server rejecting connection

What I understand from reading the FAQ and documentation is that setting
security = server in the global section of smb.conf will cause all
username/password pairs to be send to a specified domain controller to
validate the pair.  If a sucessful response is sent back to Samba it will
then allow the user to connect to the specified resource.

(What I really want to is to not have to maintain another user list on the
Samba box, i.e. smbpasswd, and make use of the user database on the Win NT
box.  Is there another or a better way to do this other than what I am
trying?)

What I'm having a problem with is that the specified domain controller
seems to be refusing to listen to the Samba server.  The following is from
my samba log files:

Connecting to 192.168.0.1 at port 139
connected to password server 192.168.0.1
write_socket(6,76)
write_socket(6,76) wrote 76
Sent session request
got smb length of 1
192.168.0.1 rejected the session

192.168.0.1 is the Primary Domain Controller & WINS server for the NT
domain.  It's working just fine for all the Win32 clients.

The following is from my smb.conf file:

[global]
  server string = Samba %v Running on %h
  workgroup = NT
  log file = /usr/local/samba/logs/%m.log
  encrypt passwords = yes
  security = server
  local master = no
  netbios name = Marina
  password server = 192.168.0.1
  password level = 8
  wins server = 192.168.0.1
  dns proxy = no
;  domain controller = 192.168.0.1

Can anyone help me out?

Thanks!