It appears from some testing that one of the libraries that ships with the SAP .NET Connector doesn’t support hardened passwords. You might get the following error:
“Name or password is incorrect (repeat logon)”
To correct the problem you need to put the latest version of the librfc32.dll into the bin folder of your .NET Application. If you have the SAP client installed on your desktop you will find this dll in the c:\windows\system32\ folder.