The s2700 fails to download the configuration file from the DHCP server.
The Microsoft implementation of the DHCP server only responds to DHCP option60 (vendor class) with options 66(bootfile name) and 147 (tftp serrver name). Unfortunately the switch fails to reasolve the tftp server name because it does not have the ip address of the dns server. the solution is to use a DHCP server implementation that respons to option 60 with option 150 -- tftp server address.
The client fails to download the configuration file from the server because it does not obtain the ip address of the tftp server from the dns.