I'm not an expert in this area as you can see, but it is my understanding that all the SC.EXE tool does is create the required registry keys in CurrentControlSet\services. I have tried adding the keys manually with the same result.
That result, by the way, is that the service is created and appears in the services list as one would expect, but when started it terminates shortly afterwards with the dialog
The service did not respond to the start or control request in a timely fashion. The program actually runs for a few seconds before this happens, and my "research" into this error indicates that this is due to the program not responding to messages from the Service Control Manager.
I have found many threads in various forums where people are trying to run non-service applications (or even scripts) as services by creating entries for them in the registry and getting this error. The accepted solutions seem to be:
1. Use SRVANY.EXE from the Windows 2003 Resource Kit or a third party tool as a wrapper for your program or script.
2. Make your program behave like a service.
I'm trying to achieve the second solution.

If I'm wrong and there is another way to to this properly, I'd love some pointers on how to proceed.