First here is the setup I have:

            Server1 -> MSSQL2005 and Reporting Services with Reporting Services DB in Sharepoint Integrated mode, Also Sharepoint webfront end installed. IIS configured with 1 default website/defaultapppool containing the Reporting Virtual Directory that is set for windows authentication only and is running under a domain account.

            Server2 -> our main Sharepoint server: I installed Reporting Services Ad-on and am able to access the Reporting Services features under application management and add report items to libraries.

            Server3 -> MSSQL2000 Sharepoint DB (we setup the sharepoint database on this SQL2000 server before we had SQL2005)

I followed http://msdn2.microsoft.com/en-us/library/bb677365.aspx mostly

The problem: Sometimes I get an unauthorized access error or unexpected error. Reporting services windows service and web service are both setup to run under domain accounts that have access to the sharepoint db and are setup as SPN’s

Under integration settings if I set the Authentication mode to Trusted Account I am able to access the Set Server Defaults page, but am not able to access reporting features from within a Sharepoint library. If I set it to Windows Authentication I am not, but I am able to access reporting features from within a Sharepoint library (sometimes).

Here is the error message I get(doesn’t help much)

An unexpected error occurred while connecting to the report server. Verify that the report server is available and configured for SharePoint integrated mode.

It is configured in SharePoint integrated mode and I am able to access it sometimes I even built a basic report on it while it was working, but I sometimes get an unauthorized access error too.