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Subscriptions that include reports, as oppose to just a link, are currently failing with "The report server has encountered a configuration error. Mail will not be resent." Reviewing the logs reveals the actual issue, "service account doesn't have rights to check domain user SIDs." This issue does not occur when only including a link to the report in email. Otherwise, users are able to generate reports just fine, subscriptions just fail when the report is embedded in the email.

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Turns out that the service account needs to be a member of 'Windows Authorization Access Group.' Without the membership the account won't have permission to call AuthzInitializeContextFromSid.

https://msdn.microsoft.com/en-us/library/windows/desktop/aa376309%28v=vs.85%29.aspx