Apologize for the delay in replying. I’ll respond here in case you are still having the issue.
That is a generic connection failure message regarding making a connection to the SQL Server instance. If you have SQL Server Management Studio installed on your Diagnostic Server, can you try to make a connection there? I’m guessing you will see the same message, and can then diagnose natively, however if SSMS can connect and Spotlight cannot, we should get a support ticket opened at support.quest.com.
I can tell you that Spotlight version 11 does support SQL Server 2005, so I’m guessing there’s something else prohibiting our connection, either an invalid servername or instance, or perhaps a firewall blocking the SQL Server port.