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I think it's 4.0. If i check the IIS manager the connection fails when I click test connection. Authentication passes but Authorization fails with the message,
The server is configured to use pass-through authentication with a built-in account to access the specified physical path. However, IIS Manager cannot verify whether the built-in account has access. Make sure that the application pool identity has Read access to the physical path.
I can't find any settings to change the read access for the application pool identity or anything similar to that, I've looked at advanced settings and basic settings of the application pool but don't understand them that well.
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Did you create a Asp.Net 4.0 website? If yes then have you enabled the deployed website to use the .Net 4.0 Framework. By default it will be .Net 2.0.
Regards,
Praneeth