You cannot setup AD integration even though it seems that everything has been configured correctly
Error: Error remote host refused connection
The root cause is “TLS v1.1” is not available on Windows 2003 by default, it is a library that is supplied with Windows 2003 R2. To enable TLS v1.1 on Windows 2003 SP2 or earlier you will have to install a hotfix downloaded via the following KB supplied by MS at http://support.microsoft.com/kb/948963 .
In some cases TLS v1.1 is not enabled, to enable it open IE and go to Tools > Internet Options > Advanced then scroll through the list until you see TLS v1.1 and make sure the box is checked.
Windows 2003 SP2 not Windows 2003 R2