This issue does not occur using 9.3. ArcMap 9.2 is incorrectly including datumtransformstring within the request WHEN the data frame CS first set by local data. The workaround is open the Data Frame Properties, go to the Coordinate System tab, expand the IMS layer and select it's CS – EVEN THOUGH – it is the same as the local data and the CS currently being used by the data frame. This will ensure that there is no datum transformation information in the request.