Creating Users for Added Domains at Blog Sign Up

I am using GoDaddy with a dedicated IP. My site structure is subdomains (sub.domain.com).

REMTW is the root domain on the Hosting, Wildcard (*) set in DNS, MU installed.

REMM is another domain on the same hosting as REMTW (both domains have the same IP). It has MU and BP installed along with multi-domain. I have 'single sign-on' enabled and REMM is set to 'private'.

REMTW is set as an 'Added Domain' to the multi-domain plugin (installed on REMM). REMTW is set to 'public'.

Here is where I'm having trouble (or the plugin just doesn't do this). From the BP dashboard on REMM I click to create blog. Fill in the dialogue boxes and say that I want a blog created on REMTW (subdomain.REMTW.com). It creates the new blog in the BP dashboard in REMM, but does not create a new User or Blog in REMTW.

So the big question - Is it supposed to create a new User and Blog in the REMTW site or do I have to create the User prior to creating the Blog? AND the really big question - Can it be set up the way I want it to work?