That definitely could be the case. Part of the problem is that I came into this with the machine already set up. So, the web files were already installed onto the machine and the SQL server was already installed onto the machine. I just reverted to the snapshot in a program we are using for that. So, basically, I did not set the machine up. Which in turn means that your question is very valid and very possible. That is actually why I ran the network trace to begin with. Unfortunately, I do not know where to dig into the code to see where it was pointing to. I was hoping for any config file, but I only saw one and there was nothing relating to this in this file.
But, this is still good information go know. At least knowing what you said about error 53 points me in a possible direction.
Thanks so far. I will keep you posted.