I just got through configuring SQL Server 2005 for a Scale-Out Deployment. One problem I ran into was the NTML "Dual Hop" issue. Fortunately I found the IIS Authentication and Access Diagnostics Tool which helped quickly identify the issue. This tool hasn't been mentioned much, so I am recommending it.
Now I've got a happy system with Report Server running separately from Reporting Services Database. Everything is working great: Reports and Report Builder. I've seen other sites which said this configuration would not work. I managed to get it working using Integrated Authentication and Kerberos.