Unfortunately, I don't get anything in verbose mode -it just goes directly to the stop sign.
Sounds like it isn't capturing Cmd+V in time as otherwise the screen would blacken and you would get rolling text. The no entry sign means that it is booting in normal mode. There is a way to add arguments to nvram to force booting in verbose mode but you would need to do it in Terminal.
If you can boot with the original XServe discs, bring up the Termainal from the Utilities menu and type the following.
sudo nvram boot-args="-v"
Until you reset the PRAM, your XServe will always boot in verbose mode.