This same issue came up in another discussion in this forum: http://scn.sap.com/thread/3461308
The gist of the solution is that you need to log into the dataserver and issue:
sp_configure 'net password encryption reqd', 2
This same issue came up in another discussion in this forum: http://scn.sap.com/thread/3461308
The gist of the solution is that you need to log into the dataserver and issue:
sp_configure 'net password encryption reqd', 2