URGENT Help with SQL Server/IIS problem

Ok, heres the story I have a huge web application that I am trying to deploy

Application 1 resides on same machine as sql Server
Sql Server 2003 running IIS6.0

Application 2 resides on same machine as sql Server
Sql Server 2003 running IIS6.0

Application 3 resides on a web server that serves the internet and is referencing the sql server that is on a Virtual Private Network

All 3 servers are talking via vpn and this has been confirmed.

In all 3 cases in the connection string I am specifying
Data Source = 192.168.11.5; .....

Application 1 and 2 are deployed and running fine
Application 3 1st revision works fine.
I made a few changes and now I keep getting this error:

"Could not logon User ...." any time I access the database

When I revert back to the old version of the software it works on the web server. Help!

Why would the same code work on the web server when the sql server is local, and not on the web server when the sql server is not local? Could it be a missing support file. any ideas...thanx.

Is the sql server using Windows Authentication?

it uses sql server authentication.
I have a user setup with a login and password

are you sure it is the database that is giving the logon failure ?

i have had similar problems and the sql server usualy gives different logon errors than "Could not logon User " and also usualy an asp.net exception (you know white yellow page with stacktrace and so on) since it's ado.net that does the logon

It is an asp error. Where I am totally lost is if I use the identical code on a server that has sql server running on it, it works, if I run it on a server that is networked with a computer running sql server and specify the IP using Data Source = "xxx.xxx.xx.xx ......" it errors out. And the most bizarre thing is that an older version was working fine before.

Any thoughts.....