I have this SPS running fine for some time now. Now, when I was trying to create
new workspaces, I go through the wizard, enter the details, afterwards, I get a
"creating workspace, will take some time" message. After sometime I get a
"permission denied" message. It asks me to check the event logs for more info. I
go into the event logs and see an entry for SPS. I open it to see the following
error,
"Workspace Creation - An index could not be created. Permission denied."

the only other erros I see in the event log is,

Windows cannot unload your registry file. If you have a roaming profile, your
settings are not replicated. Contact your administrator.
DETAIL - Access is denied. , Build number ((2195)).

I dont know if thats relevant, but just thought I shoudl post it.

I also went into SPS MMC -> Properties -> Accounts -> Default Content Access
Account and set the proper permissions there.
But still mo luck.
I havent messed with any settings of late. What could be the problem.