It's a known issue. Here's the fix http://support.microsoft.com/default.aspx?scid=kb;en-us;926959&sd=rss&spid=11373
Error description: Application Server Administration job failed for service instance Microsoft.Office.Server.Search.Administration.SearchServiceInstance (1a646aac-52e4-4742-8bea-fd2dc3d87249).
The error may be a result of Group Policy setting and can be resolved by giving “logon as a batch job” permission to Farm and SSP accounts.
Click here for my blog from earlier on this issue.
More to be added...