Problem starting gnome-session on x-server

Question

I'm using the Netsarang package to run xwindows sessions on my Windows 7 laptop. I'm running Ubuntu 10.04 on another machine within the network. I am able to connect over ssh to the server, but when it tries to open up a gnome-session it gives me this error:

** (gnome-session:1917): WARNING **: Cannot open display: localhost:11.0[18:27:25] Stop timer (TIMER_SHUTDOWN)

When I try to open up a gnome-session after ssh using Putty (with X11 Forwarding enabled), I get this error:

PuTTY X11 proxy: wrong authentication protocol attemptedPuTTY X11 proxy: wrong authentication protocol attempted ** (gnome-session:2149): WARNING **: Cannot open display:

This is my /etc/ssh/ssh_config (I removed the commented lines):

Host *  
   ForwardAgent yes  
   ForwardX11 yes  
   ForwardX11Trusted yes  
    SendEnv LANG LC_*  
    HashKnownHosts yes  
    GSSAPIAuthentication yes  
    GSSAPIDelegateCredentials no  

This is my /etc/ssh/sshd_config:

Port 22  
Protocol 2  
HostKey /etc/ssh/ssh_host_rsa_key  
HostKey /etc/ssh/ssh_host_dsa_key  
UsePrivilegeSeparation yes  
KeyRegenerationInterval 3600  
ServerKeyBits 768  
SyslogFacility AUTH  
LogLevel INFO  
LoginGraceTime 120  
PermitRootLogin yes  
StrictModes yes  
RSAAuthentication yes  
PubkeyAuthentication yes  
IgnoreRhosts yes  
RhostsRSAAuthentication no  
HostbasedAuthentication no  
PermitEmptyPasswords no  
ChallengeResponseAuthentication no  
AllowTcpForwarding yes  
X11Forwarding yes  
X11DisplayOffset 10  
X11UseLocalhost yes  
PrintMotd no  
PrintLastLog yes  
TCPKeepAlive yes  
AcceptEnv LANG LC_*  
Subsystem sftp /usr/lib/openssh/sftp-server  
UsePAM yes

I've been tinkering with the config files regarding remote x sessions since I installed Ubuntu, so I'm suspecting I messed something up.