So - if the networking block doesn't appear for students, then what link are you clicking on to SSO to the other Moodle site? Is it just any old link? The links that appear in the network block are specially crafted: They actually link to a page called jump.php on the local Moodle, which does some work and redirects the user to the remote Moodle.
So - it's not possible to make single-sign-on happen without clicking on a link from the networking block. Let's assume that this is the problem you're having... we need to make the networking block appear for you student user.
Is the student enrolled as a student in the site course? If not, then the networking block won't appear when the student user is at the Moodle homepage.
If you think this might be the problem, could you try enabling the network block on a course that the student is enrolled in? If this doesn't work, please update this forum, so that we can investigate further.
Sorry, I was suscribed to this forum but didn't get a notification that I had been replied to. When I got notification someone else had a similar (but not the same) problem, I looked to see what their problem was and found your reply.
Anyway, I have one install of Moodle (1.8.2+) with many, many sites using the one install. I am at a County Office of Education and we are supporting numerous school districts, education programs, and a series of online courses that I have written. I have enabled networking with the online course site and with one of the education programs. We want to offer the online courses as a "freebie" to those enrolled in the education program. I have also enable networking in the program. When I login as a teacher, course creator, administrator, I can see the network block on the program site to the courses site. Good. When I login as a student, however, I do not see the block. This means that the students (actually program participants) must go to the courses site and login a second time. The students have the same roles and permissions on both sites.
Did I answer your question?
I had the same issue on V. 1.9.3. I managed to get the Network Services block to work by allowing “Roam to a remote Moodle” to all roles above the Student role.
Hope that works for you on V. 1.8