These are the steps taken on a Windows XP SP2 Laptop.

Installed Windows XP with SP2.
Apply all updates.
Join XP to Domain.
Add Domain USER A to local computer as an administrator using user
manager.
Have USER A log on and test everything out.
Have USER A log off and shut down the computer.
Disconnect the computer from the network.
Turn the computer back on.
Have USER A log back into the computer.
Have USER A Lock computer using CTRL+ALT+DELETE.
Have Domain Administrator unlock computer and log off USER A.
Have Domain Administrator log on to laptop.
Have Domain Administrator log off of laptop.
Allow User A to log back into laptop.
USER A can not log back into laptop.
Error message "The system could not log you in. Make sure your User
name and domain are correct, then type your password again. Letters in
passwords must be typed using the correct case."
Going back into User Manager, USER A is not listed.
If USER A's laptop is connected the laptop back to the network,
everything is restored back to the settings that were there before.

Can anyone explain this? Thanks.