I was getting this same error this morning when trying to connect my G4 at home (has a DV deck plugged into it) to my Powerbook half way across the country. My powerbook gave the time-out error but the G4 said I had declined the invition. By the way, I was connected to the G4 with Timbuktu and starting the chat so I could accept the chat here on the road and watch the local news. It worked great. Anyways this error started to pop up this morning. When I unplugged the iSight and relaunched iChat I connected right away the first time. I haven't been able to verify this because the internet at the hotel I'm at is down right now.
Brad
edit: Oh yea, I haven't even opened up my firewall at home but I don't think that's the problem because it worked at first and I've heard of other people using iChat without opening the ports on their routers.
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