Server 2008 as Terminal Server - Change location of User Profiles

I am not able to set up a Windows Server 2008 as a terminal server in a Windows Small Business Server 2003 environment. The customer purchased a dell server with the drives paritioned as 40gb/300gb. I dont have any issues setting up Server 2008 as a terminal server except the user profiles are created on the C: Drive where I know there will be not enough space. So, I just want the user profiles to be created on the D: drive. Fo that, I tried to set the user profile in the Profile Path section of the user properties and when logging in the profile is still set in the Users directory on C: and it is temporary, it goes away when user logs off. I have also tried using the group policy with serveral different results, none of which is working. One peice of additional info, all the users that are logging into the Terminal Server are a unique group of users, and the only log into the Terminal Server. All the users are in their own container in the AD. Can anyone tell me a way to configure the servers to place the user's profile on D: drive. Thanks.

You should know that very little information or data must be stored in the profile and I am truly not seeing this as a problem. The one folder that might be argued is the My Documents folder for each user and you can relocate those. I havent looked but it may be easier to make a GPO which will move that one folder on the Terminal Service, or if this is SBS, the document redirection wizard should do that.

You can try to download the PFE edition of the Microsoft Premier Support Reporting Tool which is used mainly by Microsoft Premier Field Engineering team to help Premier Services customers gather detailed system status and configuration information. The data that is collected helps with fault isolation and general overall server information gathering. Download it from here - http://support.microsoft.com/kb/823393