I was struggling with the same issue and after an hour of serious digging I found out that its a permissions issues to the physical location where I had my...

I have created a proxy account and I still get this error dumping data to a flat file any ideas?

I tried the Microsft solution from kb 327123 http://support.microsoft.com/kb/327123, didnt work. Had to make changes to systypes table to fix my issues.

There are a couple of thing you can try like changing the status with the sp_resetstatus (BOL)if its too damaged then it might not work if the database is extensively...