deepika.sharma-632099 (2/17/2008)
To allow the network transaction, you must enable MSDTC. To do this, follow these steps: a. Click Start, and then click Run.
b. In the Run dialog box, type dcomcnfg.exe, and then click OK.
c. In the Component Services window, expand Component Services, expand Computers, and then expand My Computer.
d. Right-click My Computer, and then click Properties.
e. In the My Computer Properties dialog box, click Security Configuration on the MSDTC tab.
f. In the Security Configuration dialog box, click to select the Network DTC Access check box.
g. To allow the distributed transaction to run on this computer from a remote computer, click to select the Allow Inbound check box.
h. To allow the distributed transaction to run on a remote computer from this computer, click to select the Allow Outbound check box.
i. Under the Transaction Manager Communication group, click to select the No Authentication Required option.
j. In the Security Configuration dialog box, click OK.
k. In the My Computer Properties dialog box, click OK.
source: http://support.microsoft.com/?kbid=873160%5B/quote%5D
This resolved my issue when setting up a Subscription on a remote server.