Can't add User with Administrator, Domain Admin rights to Farm Administrator group

I have  SharePoint 2007 SP2 installed on Windows Server 2008 R2 Enterprise.

I am logging onto the server through RDP as a user who is a member is a member of the BUILTIN/Administrators , Domain Admins and Enterprise Admins Groups. However, I get a login box when I try to use Central Administration (BUILTIN\Administrators is a member of the Farm Administrator's group so I should be able to use Central Administration) I get this error:

Error message 401.2.: Unauthorized: Logon failed due to server configuration.  Verify that you have permission to view this directory or page based on the credentials you supplied and the authentication methods enabled on the Web server.  Contact the Web server's administrator for additional assistance.

Thinking that somehow SharePoint is not honoring the BUILTIN\Administrators group, I tried to add the username to the Farm Administrators group directly and get this error:

Local administrator privilege is required to update the Farm Administrators' group.

My only clue as to what is wrong is that since this machine is a Domain Controller (you cannot see Local Users and Groups in the Computer Management snap-in) the BUILTIN\Administrators group has less rights than it does on a normal server. On other farms I have built with users having BUILTIN\Admnistrators rights I have never had a problem adding them to the Farm Administrator's group.

Does anybody have a clue what is going on?

Thanks. . .

Kathryn