Remote desktop is designed to make the default local printer the default
printer for the Remote Desktop session.
If this is not happening, there are several possible reasons.
1) printer redirection involves redirecting the port--different from the old
peer-to-peer printer sharing model. By default, only LPT and COM and USBxxx
(001,002, etc) ports are redirected.
If your local printer is USB connected, and is a multifunction device, it
may well use a DOT4 port. If so, this KB article may help. Apply the
registry change mentioned, and reboot before testing further. I've seen
some cases of success from this change, and others where apparently there
was no change.
(you can see the type of port by looking at the Ports tab in properties of
the printer.)
http://support.microsoft.com/?kbid=302361
2) (and this may be needed IN ADDITION to the above paragraph.) Since the
port is redirected, the printer driver needs to be available at (and
appropriate for) the host machine. In your case, since the host is a
server, you want to take great care that the driver is signed--i.e. has
passed WHQL testing and thus is less likely to crash the server. So--you
need to make the driver available on the host machine.
My procedure to do this is to download the driver --usually from the
manufacturer's web site, and install it on the host as though I were
installing a new local printer on LPT1. If you have a multifunction device,
try to find a print-only driver. Once the new "printer" is installed, you
can then delete it, but when queried by the removal process about whether to
delete files used by just that printer driver, say no. This will leave the
driver files available for use by Terminal Services, but not clutter up the
server's printer folder with printers which don't exist.
So--redirect the port and provide the driver at the host. There are other
possibilities, bugs in pre SP1 XP hosts, and perhaps other bugs, but they
are unlikely to apply to your situation.
See whether this helps you out, and let us know if you succeed!