If UAC is enabled on the server ( It being a 2008 server UAC will be enabled ) even then live update can fail.
PLease try this Run backup Exec as an administrator and then run live update from it.
You can configure alerts for the devices . PLease refer the article http://seer.entsupport.symantec.com/docs/309830.htm
You can configure the Device error and Device warning Alerts and it would inform you if there are any kind of Device related erro...
Please check the system Logon Account. Go to network | logon accounts in Backup Exec and Check the account.
It should be of the format Domain name\user_id.
If the system logon account is correct then check if the backup exec services are runn...