THAT message looks like the task handler isn't working at all. Do any tasks arrive at the workstation? That is, if you were to make a quick script task maybe a one-liner to just do like a popup message box in VBScript, would the workstation get it? I like to set the script task with the name of "HI" and just one line:
msgbox "hi"
Then under advanced, set it to run under the currently logged on user. Assign it to a workstation you're actively watching / logged on to, and see if it gets there.
If not, you're problem is bigger than DS. It could be the agent isn't finished installing or... well, several things. But that's a starting point. It SOUNDS like the prepare for image capure task isn't running at all. Is that what it LOOKS liike?