I had a similar problem occurring this morning. The issue was that there were two entries for the same server listed in the drop-down sql server list for multiple servers. How this happened? I don't know, but there is an MDAC Component checker that may assist you in resolving your problem. It may be that you have corrupt MDAC files. Here's the URL: http://www.microsoft.com/downloads/details.aspx?FamilyId=8F0A8DF6-4A21-4B43-BF53-14332EF092C9&displaylang=en
Also, the suggestion above to use the IP address did clear up the problem for me and was a solid quick fix.