Same problem here with the xset command:
$ xset +fp tcp/localhost:7100
xset: bad font path element (#87), possible causes are:
Directory does not exist or has wrong permissions
Directory missing fonts.dir
Incorrect font server address or syntax

Anyone?

The good news is that I *FINALLY* got to see the remote login screen (thanks to steps 1 and 3, above), but after entering my username and password (I can choose CDE, Gnome 2.0, User's Last Desktop or Failsafe Session). If I choose CDE or Failsafe Session, then it looks like it is going to load, but all I see is a funky Solaris hourglass and a black screen and then it pops back to the login screen. I did see these errors when launching the command:
% Xnest ":1" -geometry 1280x810 -query localhost
Permission denied
X_mkdir: Not owner
X_mkdir: Not owner
X_mkdir: Not owner
X_mkdir: Not owner

Grrrr!!!

HOWEVER, if I choose Gnome 2.0, then it shows me the Solaris 9 splash screen, then I see the Gnome icons marching across, and then the desktop loads (there's the foot icon and menus!), BUT, as it's about to put up the desktop icons, it craps out to a black screen and back to the login...
My Xterm has these errors:
% Xnest ":1" -geometry 1280x810 -query localhost
Permission denied
X_mkdir: Not owner
X_mkdir: Not owner
X_mkdir: Not owner
X_mkdir: Not owner
XDM: too many retransmissions, declaring session dead
Permission denied
X_mkdir: Not owner
X_mkdir: Not owner
X_mkdir: Not owner
X_mkdir: Not owner
AUDIT: Wed Mar 22 23:23:32 2006: 2105 Xnest: client 1 rejected from local host
Auth name: MIT-MAGIC-COOKIE-1 ID: -1
AUDIT: Wed Mar 22 23:23:32 2006: 2105 Xnest: client 1 rejected from local host
Auth name: MIT-MAGIC-COOKIE-1 ID: -1
AUDIT: Wed Mar 22 23:23:32 2006: 2105 Xnest: client 1 rejected from local host
Auth name: MIT-MAGIC-COOKIE-1 ID: -1
AUDIT: Wed Mar 22 23:23:32 2006: 2105 Xnest: client 1 rejected from local host
Auth name: MIT-MAGIC-COOKIE-1 ID: -1
AUDIT: Wed Mar 22 23:23:32 2006: 2105 Xnest: client 1 rejected from local host
Auth name: MIT-MAGIC-COOKIE-1 ID: -1
AUDIT: Wed Mar 22 23:23:32 2006: 2105 Xnest: client 1 rejected from local host
Auth name: MIT-MAGIC-COOKIE-1 ID: -1
XDM: too many retransmissions, declaring session dead
Permission denied
X_mkdir: Not owner
X_mkdir: Not owner
X_mkdir: Not owner
X_mkdir: Not owner
...and so on until I kill the login screen (Xnest) window.
What a tease!!!!

On the server, all is quiet for the CDE/Failsafe logins, but Gnome logins seem to have this error logged:
Mar 22 23:22:19 <hostname> gconfd (<user>-2207): [ID 702911 user.info] starting (version 2.1.0), pid 2207 user '<user>'
Mar 22 23:22:19 <hostname> gconfd (<user>-2207): [ID 702911 user.info] Resolved address "xml:readonly:/etc/gconf/gconf.xml.mandatory" to a read-only config source at position 0
Mar 22 23:22:19 <hostname> gconfd (<user>-2207): [ID 702911 user.info] Resolved address "xml:readwrite:<~user>/.gconf" to a writable config source at position 1
Mar 22 23:22:19 <hostname> gconfd (<user>-2207): [ID 702911 user.info] Resolved address "xml:readonly:/etc/gconf/gconf.xml.defaults" to a read-only config source at position 2

I see some of these as well, but now get no new logs (so maybe they're only logged once per X session?):
Mar 22 23:12:20 <hostname> sshd[1766]: [ID 800047 auth.error] error: connect_to localhost port 7100: failed.
Mar 22 23:12:34 <hostname> sshd[1766]: [ID 800047 auth.error] error: connect_to ::1 port 7100: Network is unreachable
Mar 22 23:12:34 <hostname> sshd[1766]: [ID 800047 auth.error] error: connect_to 127.0.0.1 port 7100: Connection refused
Mar 22 23:12:34 <hostname> sshd[1766]: [ID 800047 auth.error] error: connect_to localhost port 7100: failed.

So close, yet so far...
Anyone?

I opened port 7100 on my firewall(s) as well and imagine that should resolve the sshd issues (and why they may have been logged once, but not since).