Error creating DB image
Are you creating the snapshots over the WAN links? Maybe a slow link has something to do with it. If you have error handling, such as a Try/Catch block around the Database.Register(), perhaps it would be more revealing to catch an error type of SqlException rather than just plain old System.Exception. More often than not, all that catching System.Exception will show a null reference error in place of the 'real' problem, which may be related to the SQL connection.
Please let me know if you need more explanation.