I have run into this situation a couple of times. It is one of those RTFM, I am blogging it here so that it gets indexed and someone will find it useful.
On a windows server 2003 with multiple server installation. There are times that the Web Service Publishing Wizard option is not available on the Biztalk group.
This is because somewhere along the installation instructions, someone skip the step that instruct you to install Visual Studio 2005. Perhaps this is a mis-conception, that you dont need Visual Studio if you are setting up a QA environment, or even a production environment. This might be true, but if you need to use the Web Service Publishing Wizard, you will need to install the Visual Studio runtime and the SDK for .NET 2.0
Run the Visual Studio Setup. Select custom, then select C# and select the SDK option.
After this is installed you will need to re-run the installation setup for Biztalk. Select Modify and then select the Developers Tools and SDK checkbox. Click OK to continue.
now if you pay attention to the status screen, you will see this message being display
after the installation is done, open the program selection and you will see that now we have the Biztalk Web Services Publishing Wizard available to choose.