A: Basically this is a permissions error. Here are a few things to check.
Check and see that the person that published the report is in the same "group" as the portal user that is trying to run the report. For example, if you published the report to the portal as admin/admin, then only the people in the "admin" group would have access to the report.
Make sure that in the proserv.prf file that you have the correct path for the MDLFilename=. If it is blank, it can cause this error.
Make sure that when you define the users in portal that they are using a password. CleverPath reporter is checking for both a user and password to run the report. By not having a password, you can get this error.