Can you post the xp_CmdShell call that you're using, please? I have a couple of ideas on the problem but I need to see that command. If it's not a trusted connection please replace the user name and password with "username" and "password" respectively. You can also replace the server name with "servername" if it makes you nervous to have that info out there.
--Jeff Moden
Change is inevitable... Change for the better is not.