Here is the error: An error has occurred while establishing a connection to the server. When connecting to SQL Server 2005, this failure may be caused by the fact that under the default settings SQL Server does not allow remote connections. (provider: SQL Network Interfaces, error: 26 - Error Locating Server/Instance Specified).
If this was your exact error while debugging application there is a resolution!
After days and days, hours and hours I have this problem resolved.
I contacted someone with a little more resources(Microsoft Directly) then myself, and here is what they found:
This error is caused by a bug when you uninstall and reinstall SQL server. To fix this error is relatively simple:
Locate the following folder(This is the location in vista):
C:\Users\*YourUserName\AppData\Local\Microsoft\Microsoft SQL Server Data\SQLEXPRESS
Delete the SQLEXPRESS Folder.
Start the SQL Server Configuration Manager
SQL Server will repopulate that folder.