Sophos Enterprise Console 5 - Cannot connect to SQL Instance

Kind of getting stumped on this one.

We are installing SEC5 on a clean (up-to-date) Server 2008 R2 machine and trying to connect it to an SQL 2008 R2 server where the SOPHOS database will reside.

We have created a domain user domain\sophosdb and have given it appropriate rights to the SQL server and have mapped it and provided full GRANT rights to the SOPHOS50 instance we have created on this SQL Server.

During the install of SEC5 where I tell it which server\instance to connect to and provide the sophosdb user credentials, it sits there for about 15 seconds and then says the credentials do not have access to the instance. Well, it certainly does !

I've verified a few things, such as entering incorrect credentials, which immediately responds that they are incorrect and do not have rights (which I expected it to do) - so thus when I enter the correct credentials, it takes quite a bit longer so it is getting part of the way there !

We have a lot of other applications that access this SQL server, and we have setup access for SEC5 in the same fashion as we have for everything else, but it refuses to work.

Is there something 'odd' we should be aware of ? Did we miss something 'non-obvious' ?

So to recap, we have ;

Created a SOPHOS50 instance on SQLSERVER.OURDOMAIN.COM
Created SOPHOSDB user within OURDOMAIN.COM
Granted SOPHOSDB user access to SQLSERVER AND the SOPHOS50 instance with FULL rights
Started the SEC5 installer and it will not connect to the instance saying the credentials are wrong.

SQL resolves and pings fine from the SEC5 machine.
Both machines are on the same domain.
All pre-requisites for SEC5 installation have been met.
Definitely no firewall issues anywhere.