1. Add a new value of "EnablePlainTextPassword" to the key below, modify the value to be a DWORD value of "1". 

2. Exit Regedit and Reboot. 

Key:[HKEY_LOCAL_MACHINE\SYSTEM\CurrentControlSet\Services\Rdr\Parameters]
Value Name: EnablePlainTextPassword
Data Type: REG_DWORD
Data:(0=disable, 1=enable)
More info: http://support.microsoft.com/support/kb/articles/q166/7/30.asp