QNTC: Windows Policy Settings will need to be changed to allow R540 client to authenticate to the Windows Server 2008/2008 R2 or Windows 2008/2008 R2 AD Level:

After applying solution found in this IBM document, a mystery is solved.
A profile on our V5R4 machine, created back in 2005, is finally able to
connect to network servers with WRKLNK and CPYTOIMPF.

This is a happy day.
Eric

IBM Software Technical Document

Document Number: 578612192
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Functional Area: Integrated File System
SubFunctional Area: QNTC
SubSubFunctional Area: General
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Product: I5/OS (5761SS100); IBM I (5770SS100); OS/400 BASE (5722SS100)
Release: 5.4.5; 6.1; 6.1.1; 7.1; V5R4M0; V5R4M5; V6R1M0; V6R1M1;
V7R1M0


Keywords: QNTC, SMB Client
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Document Title:QNTC Required Change for Accessing Windows 2008/2008 R2
Servers
Document Description:
The following
Windows Policy Settings will need to be changed to allow R540 client to
authenticate to the Windows Server 2008/2008 R2 or Windows 2008/2008 R2
AD Level:

"Network Security: Do not Store LANMAN hash on next password change" New
Value = Disabled:
"Network Security: LAN Manager Authentication level" New Value Send LM &
NTLM - use

After the changes are saved, the user profiles passwords will need to be
reset to allow the LANMAN Hash to be generated. Note with the
Application of the PTFs for R610 and R710, these changes are not
required. The PTFs enable the NTLMv2 support.