Wierd IIS 6 Authentication

[igolo]

Okay I spent the better part of two days trying to figure this out, but can't get it.

built a new 2003 server with IIS6 and installed Sharepoint Services on it. Everything works fine. Then I moved our Intranet site from an NT4 IIS4 server to the IIS6 server. They are separate sites one using port 90 and other using port 80.

Problem: When I configure the Intranet site with Integrated Windows Authentication (IWA) users can't access the page. They get a logon box with FQDN prompting them for credentials although it never passes the credentials on. When I set authentication to basic and set the domain and realm to the NetBIOS domain name, it prompts them to authenticate. However, the logon box reads the NetBIOS domain name pass the crendentials on.
Now the wierd part is the sharepoint server, is set to IWA and it never asks for login credentials - it just works.

Goal: I want to be able to use IWA without the users having to enter credentials. Single sign-on

Things I have tried
Searched this forum among others
Setting the SPN to NetBIOS name
modifying web.config
Setting a pointer in DNS
Made changes to IE
deleted and recreated the site
verfied that both site properties matched as much as possible

Oh one other thing - this server is also a BDC with AD & DNS

 

[igolo]

Update on this
I changed removed the primary DNS Suffix under computer name changes and added the NetBIOS name of the server to the DNS Suffix for this connection under advanced TCP/IP settings.
Now my Intranet site work just the way I want it to. Users are authenticated transparently, however now my sharepoint services website won't load and kicks back this error:

Unable to connect to database. Check database connection information and make sure the database server is running.

The database is working fine.
What is going on here?
Any help would greatly appreciated.