Here is the section from BOL which may shed some light:

thanks - Deepak
Connecting to the Distributor
The Distributor can be the same server as the Publisher (local Distributor),
or it can be a separate server from the Publisher (remote Distributor). When
using remote Distributors, you can configure the security necessary when the
Publisher and Distributor connect.

The connection between a Publisher and a remote Distributor is a hybrid of a
linked server and remote server. The connection uses the login
distributor_admin. At the remote Distributor, the Publisher can be
configured to be either trusted (no password is required for the
distributor_admin login) or non-trusted (a password is required).

It is recommended that you use a non-trusted connection for the Publisher
connection to the Distributor, requiring a distributor_admin password. This
increases security at the Distributor by restricting access. Members of the
sysadmin or db_owner roles who want to use a Distributor must know the
administrative link password. An incorrect distributor_admin password at the
Publisher causes the configuration of replication at the Publisher to fail.



Warning Do not change the password for the distributor_admin manually.
Always use either sp_changedistributor_password or the Distributor tab of
the Publisher and Distributor Properties in SQL Server Enterprise Manager
because password changes are then applied to local publications
automatically. Changing the distributor_admin password manually causes
publications using a local Distributor to fail.



This posting is provided "AS IS" with no warranties, and confers no rights.


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