OK, it seems, if I'm understanding correctly you are attempting to Remote into an XP machine from a Windows 7 machine. Is that correct? The error you described in your OP sounds more like an error from a Win7 client rather than from an XP client, so I suspect, that there is something in place as a security buffer, like a TS Gateway which would require a certificate be in place on the client machine(s), or even something like an ISA server that might require you machine or user account be added to a firewall exception for RDP.
If so first make sure that the XP machine has been hotfixed, patched, updated and service packed fully.
Second according to what I am seeing, the XP machine is a domain member, so again, whoever is responsible for managing that domain should be able to tell you what kind of hoops you are required to jump through in order to successfully RDP into one of his domain machines.
If you are thinking that it's an issue with Windows 7 (which would mean that you are able to connect using, say a machine with XP installed), you might be right.....but, only to the extent that the Windows 7 machine hasn't been properly "allowed" with respect to rules and policies that exist on the domain. Or is not configured with the proper software and updates installed to pass those same rules or policies.
Regards
Randy