Unable to begin a distributed transaction

Found it, MSDTC on the remote server was a clone of the local server.

From the Windows Application Events Log:

Event Type: Error
Event Source: MSDTC
Event Category: CM
Event ID: 4101
Date: 9/19/2011
Time: 1:32:59 PM
User: N/A
Computer: ASITESTSERVER
Description:

The local MS DTC detected that
the MS DTC on ASICMSTEST has the same unique identity as the local MS
DTC. This means that the two MS DTC will not be able to communicate
with each other. This problem typically occurs if one of the systems
were cloned using unsupported cloning tools. MS DTC requires that the
systems be cloned using supported cloning tools such as SYSPREP.
Running ‘msdtc -uninstall’ and then ‘msdtc -install’ from the command
prompt will fix the problem. Note: Running ‘msdtc -uninstall’ will
result in the system losing all MS DTC configuration information.

For more information, see Help and Support Center at
http://go.microsoft.com/fwlink/events.asp.

Running

msdtc -uninstall
msdtc -install

and then stopping and restarting SQL Server service fixed it.

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