2000 can't issue licenses to 2003/2008. Reason is they changed the TS model in 2003. In 2000 you only had to buy TS licenses for 98 and below. 2000 and xp were free. Now MS charges for every TS license.
I should have remembered this!
Solution is to run ADprep and upgrade your forest to 2003/2008 and set the TS license server to at least 2003. You will need to buy a TS license for every TS connection.
Welcome to Microsoft.