On the client please first check if the actual logon name matches the displayed username: Start, Run, type control userpasswords2 and Hit Enter. If this is OK then:
On the Client computer go to C:\Documents and Settings\All Users\Application Data\Microsoft\Crypto\RSA\MachineKeys and see that the FOLDER AND ALL FILES in it have Full permissions for the Administrators GROUP and SYSTEM account.
(by nigelbb in http://forums.microsoft.com/WindowsHomeServer/ShowPost.aspx?PostID=1922353&SiteID=50)
or
On the client computer: Start, Run, type rundll32.exe keymgr.dll, KRShowKeyMgr, hit enter. Then find the name of your WHS, highlight it and "Remove it". Logoff, then back in, and update your password one final time through the WHS client. If all goes well, it should resolve it.
(by dmxrob in http://forums.microsoft.com/WindowsHomeServer/ShowPost.aspx?PostID=2284855&SiteID=50)
