OK - I won't go into how to get up password sync in ILM07 - there are plenty of documents out there. But here's an interesting error I got and took a couple of hours to work out.
I had successfully created an SPN against the account I was using to run MIIS. But try as I might, I couldn't create a PCNS link - I just got:
"The service principal name you specified could not be found..."
Anyway - it seems that PCNSCFG is fussy about its slashes. When you use the /S option you need to put a forward slash between the SPN name and machine, NOT A BACKSLASH!
Oh well!