I had problems setting up mine too with DHCP. It turns out that LTSPAdmin sets it's own DHCPd server up. so if you have SuSE installed with it's own DHCPd installed then it could be causing problems. Try uninstalling SuSE's DHCPd and then reinstalling LTSP.
Oh and how did you get the PXE booting setup on the server side, config wise... I can't find documentation on it.