Just banged my head against a wall for a while on this one. In Server 2008, at least with Terminal Services installed, it would appear that if you want to add a new local printer port, you must be logged in as the local admin, not any other admin-enabled account. Every time you go to add a new local printer port and give it a name, the machine kicks back that it's an invalid name.
So, my resolution was to configure it while logged in as a local admin.
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