Windows Server unable to synchronize NTP time reliably

Jeff, I found this article. Might be of some help to you. You might have already read this but I thought it was worth a shot.

HKLM\SYSTEM\CurrentControlSet\Services\W32Time\Config\AnnounceFlags

This registry entry controls whether the local computer is marked as a reliable time server (which is only possible if the previous registry entry is set to NTP as described above). Change this REG_DWORD value from 10 to 5 here.

UPDATE As per Jeff, best source of reference is http://support.microsoft.com/kb/816042

Windows Time Agent is a free control panel applet for configuring the NTP server/synchronization ability of Windows. It acts as a front-end to the registry settings and lets you configure multiple NTP servers and see what sort of results you are getting from them in real-time.

Not many people know about this particularly handy (and free) piece of software, but it's a must-install on servers I maintain.

When synchronized time is important, I use NTPD for windows

http://www.meinberg.de/english/sw/ntp.htm

I install it, point it at north-america.pool.ntp.org and forget it

The way that Microsoft suggests to sync time is visualized below.

So why can't Windows reliably sync NTP? It has to do with how time is set up in a domain environment. From this Technet artice:

If the computer is a member server or workstation within a domain, by default, it follows the AD DS hierarchy and synchronizes its time with a domain controller in its local domain that is currently running the Windows Time service.

You are going "against the grain" here by trying to set up member servers to pull NTP time.

The "Right" (Ie. the Microsoft way) to do it would be to set time up as displayed in the picture above, having the PDC Emulator sync to a reliable external time service such as pool.ntp.org, having the domain controllers sync to the PDC emulator, and then having the member servers and PCs automatically sync from a domain controller.

I have detailed the process of fixing the time to operate this way in this answer.