When CRM and SQL/SQL Reporting Services are on different computers, problems with trust for delegation may occur.
The SRS Data Connector should sort out these errors. However, I did have a situation where reports via CRM did not work but they did in Report Server.
In conjunction with Microsoft Product Support, I discovered I had to change a delegation setting on the computer account for the SQL Server.
In Active Directory, open the computer account for the SQL Server and
- for Windows 2008 AD, click on the Delegation tab and ensure that “Trust this computer for delegation to any service (Kerberos only)” is ticked
- for Windows 2003 AD, click on the General Tab and ensure that “Trust computer for delegation” is ticked
In my situation this was set to “Do not trust this computer for delegation”.