Hey Matthew,
First off, I don't think I asked this question previously: which version of Toad are you using?
One thing to check is to make sure you're entering your password into both fields in the task wizard in Toad. The next step would be to try creating the same task (just to run TOAD itself) from the Windows Task Manager itself and see if you can register and run it. The error message you're getting back is coming from your Windows Active Directory, and is just passed back through Toad. As a result, I suspect you'll also have trouble from Windows Task Manager. If you do, there's some setting on your AD that's locking that account out.
Let me know what you find.
-John