Mandatory User Profiles...weird

[user001]

Hello,

I've got a DC and a terminal server.

I've created user1 and templateuser

My profile is located on \\domaintroll\profiles\templateuser

I've used the profile management tool to copy the profile to \\domain.local\profiles\manuser and renamed the ntuser.dat to ntuser.man

I select a group for the permitted to use option which both user1 and templateuser are in.

I've specified the terminal services profile path in the user1 account via AD.

When i login as user1 to the terminal server it creates a user account in

\\domaintroll\profiles\manuser\user1.domain

why???!!?

User1 has access and its not even loading the madatory profile? what am i missing here?

Server 2003 DC (ent) TS (std)

Any help would be great.

THank you.