Interesting discussion concerning the ins and outs of security of Linked Server vs Other Approaches, but I'm glad I didn't wait for somebody to help me with a solution to...

Through experimentation I now have a workaround.

Create an alias on ServerName1 that equals "DesiredLinkName" with correct IP Address and port.

Create a standard SQL Server link and specify the alias as...

Toby White (4/13/2010)

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My sincere advice to you is abandon linked server. It poses a security threat and it's only use is to circumvent doing it the right way by doing...

No explicit DENYs found.

Further investigation reveals that the rights exist via Query Analyzer, but the options are grayed out on Enterprise Manager.