1) Check the Databases compatability from Enterprise manager. It should be 80 for SQL 2000. If it is not, then you have this error.
2) Install SQL agent with SA account
3) Check the SQL services properties. If particular service is started with any specific account, make sure that account has LOAD AND DUMP permissions on databases.
When the agent sees that a certain version of SQL is installed, it can only backup database with that compatibility level (this is what I have seen to this point). It is also my experience that upgrading SQL (say from 6.5 to 7) only updates the compatibility level of standard SQL databases. Custom databases tend to not get updated properly.
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