Disk Quota entries list is empty. "Quota information cannot be add

Hello.

I am trying to set and enforce disk quotas (on WS2003 member server in
AD domain, NTFS volume). In volume properties\Quota tab I set "Enable
quota management". It warns me that scanning will take some time,
trafficlight changes to yellow, then I click "Quota entries" and nothing
is in the list, not even for Administrator's account. When I attempt to
create entry I enter user's logon name, click "Check Names", it
correctly resolves to username (with e-mail address), and then I get
"Quota information cannot be added. User is unknown. User: "

The same steps on any _other_ machine (WS2003 or XP) bring up the list of
accounts with their disk usage and I successfully can specify disk quota for
any account.

DCDIAG and NETDIAG are not showing any problems. No errors in Event logs
(other than "The system has successfully rebuilt the user disk quota
information on device with label "Data".")

What is wrong and how do I fix that?

Thanks.
WBR,
KP.