The Authentication was set to 'Windows only', the startup service account set to 'System account', which is how I installed SS2K (Developer Edition).
I tried changing the Authentication mode to SQL Server and Windows, cycled SQL Server and the Agent account, and tried again. Exact same result.
Here are the actual error particulars:
Error Code: 0
Error Source = Micorsoft OLE DB Provider for SQL Server
Error Description: [DBNETLIB](ConnectionOpen(Connect())).]SQL Server does not exist or access denied.
The DBNETLIB bit seems odd. I'm running TCP/IP and Named Pipes, and everything is on the same (W2K Pro sp2) box. It almost sounds like the DTS pkg can't see the (SQL) server.