I have had such an error after I installed freenx from its ppa to Kubuntu 10.10 and tried to connect to it from another Kubuntu. I have searched the solution from web. But couldnt find a solution.Later I have realised that it is a problem with file permissions and did this sudo chmod o+rw /var/lib/nxserver/db/running/ That solved my case.
Errare humanum est sed perseverare diabolicum.