When FRS (File Replication Service) tries to open the root folder on the drive that the Sysvol is located on, the Ntfrs.log file records:

Event Source: Ntfrs
Event ID: 13552
Description: The File Replication service is unable to add this computer to the following replica set: "Domain System Volume (SYSVOL Share)".
This could be caused by a number of problems, such as:
-- an invalid root path,
-- a missing folder,
-- a missing disk volume,
-- a file system on the volume that does not support NTFS 5.0

The information below may help to resolve the problem:
Computer DNS name is "computername"
Replica set member name is "computername"
Replica set root path is "C:\Winnt\Sysvol\Domain"
Replica staging folder path is "C:\Winnt\Sysvol\Staging\Domain"
Replica working folder path is "C:\Winnt\Ntfrs\Jet"
Windows error status code is FRS error status code is FrsErrorVolumeRootDirOpenFail

If you attempt to rename the label on the volume, you receive:

You do not have sufficient privileges to perform the operation.

This behavior may occur if the the read-only flag is set on the root of the volume, or if the System account does NOT have Full Control permissions.