We get the error, "NetKey: Network Key identification error!". What does it mean?

Please note that a NKLS instance on the server can support one Network Key (i.e. one application). If you deploy 2 network-licensed applications, you will need to run 2 instances on the NKLS on the server.
Regarding the error message, it's possible that you run a protected application with Program ID=0. It connects to the NKLS that detects the Network Key with Program ID=0. Then, you run another application with Program ID=1. It connects to the same NKLS instance under the same TCP port. Since the NKLS is already serving the Network Key with Program ID=0, it returns the error Network Key identification error! to the application.
For details how to deploy the NKLS, see the Reference Help topic below.
> NetKey License Server > Deploying NKLS and Network License > Deploying Multiple Network Licenses