Identity requires “DOMAINNAMEUsername” format

ReportingServices produces the folloging error if the ApplicationPool’s identity is not well formed as in “DOMAINNAMEUsername” format:
“The report server is not responding. Verify that the report server is running and can be accessed from this computer”

PS: You may find which permission issue causes the error using FileMon or ProcessMonitor utility.

Also i strongly recommend using SysInternals Suite.