Apparently, RHEL has a bug in rhn_register. If you try to register from the command line you will get an error and the system will exist with:

An error has occurred:
up2date_client.rhnreg.InvalidDefaultError
See /var/log/up2date for more information

Red Hat sent us a workaround by using rhnreg_ks

rhnreg_ks --username= --password=

This worked for us. Of course, you have to have a RHN subscription to register your system.