T-SQL (SS2K8) :: Cannot Access Server From Client App?

I have a C# windows app trying to access database based the connection string stored in teh app.config file

Here is my app.config parameters

<?xml version="1.0" encoding="utf-8" ?>
<configuration>
<connectionStrings>
<add name="con1" connectionString="data Source=127.0.0.1sinclair;initial catalog=kingsroad;uid=balrock;pwd=123456;integrated security=True" />

</connectionStrings>
</configuration>

The reason I want to put an ip address on connection string i just want to create connection strings as people do in their work. When the app tried access the connection string it gives the error in the attachment.

Because I haven't used this user/password for a long time I'm pretty sure the user name and password is correct but i have the following questions

1. Assume the user and password is incorrect, is there way to reset this?
2. what other configuration that i need to do in order to make teh C# app access this Database?