I see you're using late binding to access MS Project. One thought could be that the Microsoft Project namespace changed from 2K3 to 2K7 and it is no longer called "MSProject.Application".
However, since you only have this installed on the server and you know exactly which version of MS Project to expect, why use the late binding? Try adding MSProject to your references directly and revert your code to early binding. Then see if you still have the same problem.
A few other things I might try if that doesn't work:
1) Make sure all versions of office have the latest service packs and updates
2) Look at the optional features of MS Project that may not have been installed and consider installing them
3) Upgrade to MS Access 2007