Re: Windows 2003 Server would not defrag the files / disk
I have had similar problems on Windows 2000 Server, and I used PerfectDisk to fix it. It turns out that the Metadata files can get fragmented and scattered over the disk. The fragments just need to occupy a single sector in a large open space to prevent the Windows defrag program from doing the defrag.
Try installing PerfectDisk and then do the boot time defrag at the earliest convenience to tidy up the metadata. You'll need the server version, which you can try out for 30 days.
Raxco has a special offer on their server product for $99, so it may be a good time to buy, but try it first in any case to make sure you like it.
You can find a lot more information about defrag programs at "The Great Defrag Shootout" on my blog.