Mobile replication

I have the following setup

Server 1: Windows 2003 inc IIS. Also on this server is SQL Server Web sync web service and it has an external IP address for internet connectivity

Server 2: Windows 2003 inc SQL Server 2005. This server has a database setup with replication so the a Window Mobile 5 device can do a merge replication.

My problem is that the replication fails when trying to send the snap shot from Server 2 to the mobile device. The device seems to get through to the replication agent, as entries in the Replication monitor are logged (see below).

I have checked all the permissions on the relevant shares required for replication (basically set "Everyone" with full access).

My initial question would be.... When the snapshot is been sent to the mobile device, does the SQL Server try to send it directly to the internet or does it go through "SQL Server Mobile Server Agent 3.0".

Please can someone help, as this is causing me some REAL problems.

Error messages:
The schema script '\\ukrt1-sql902\SQLRepl\unc\UKRT1-SQL902_EXEL_DAMAGECODESEXEL\20060810142533\DamageAction_2.sch'
could not be propagated to the subscriber. (Source: MSSQL_REPL, Error number: MSSQL_REPL-2147023570)
Get help: http://help/MSSQL_REPL-2147023570

The merge process was unable to deliver the snapshot to the Subscriber. If using Web synchronization,
the merge process may have been unable to create or write to the message file. When troubleshooting,
restart the synchronization with verbose history logging and specify an output file to which to write.
(Source: MSSQL_REPL, Error number: MSSQL_REPL-2147201001)
Get help: http://help/MSSQL_REPL-2147201001

I fixed this issue....

The snapshot directory on the datbase server didnt have the correct permissions. This is because the SQL Agent on the IIS server was setup with the default user... The IIS default...