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Where can and can't you install an automation server?

I'm looking to install an automation server on a remote network but I'm running into an issue. When I install this on a test box on that network everything was fine. I can't keep the test box setup the way it is now so I wanted to install this on the DC (I know that's usually a very bad thing but the only other option I have is the SQL server and I think that would be a worse move) but every time I attempt this it will not connect to the SQL server to make a database. Is this due to it seeing itself attempting to be installed on a DC or is this just something funky with the SQL box? How much of an impact would this have on the SQL box if push came to shove?