LOOKUP_BI-756009 (12/17/2012)
Restarting the server fixed the problem. Did not change anything, still not sure how that happend. Thank You
I had this issue many many times on SQL 2005 SP4 running on Server 2003 and it beyond frustrating because I was never able to determine the root cause. In my case dropping the proxy and recreating it using sp_xp_cmdshell_proxy_account always did the trick.
There are no special teachers of virtue, because virtue is taught by the whole community.
--Plato