Server 2003 password issues

I loaded the server with a copy of windows server 2003 which I streamlined with service pack 3
Started to enter computers in Active Directory but when I tried to enforce a simple password so as students can access server
Windows would not allow me to use a non-complex password
I went through the usual process of making passwords non-complex, but windows will not allow me to
So I tried to use complex passwords, but now even those are not accepted
I am starting to think maybe the new service pack has something to do with it
Any suggestions would be most welcome