Users in Web.Config - .net-4.0

Question

i have a web.config file that looks like this:
<?xml version="1.0"?>
<configuration>
<system.web>
<compilation debug="true" strict="false" explicit="true" targetFramework="4.0"/>
<authentication mode="Forms">
<forms name="dispatchBalancer">
<credentials passwordFormat="Clear">
<user name="dispatch" password="password"/>
</credentials>
</forms>
</authentication>
<authorization>
<deny users="?"/>
</authorization>
</system.web>
</configuration>
When ever i try to log into the site using a normal login control i keep getting the following error:
A network-related or instance-specific error occurred while establishing a connection to SQL Server. The server was not found or was not accessible. Verify that the instance name is correct and that SQL Server is configured to allow remote connections. (provider: SQL Network Interfaces, error: 26 - Error Locating Server/Instance Specified)
The thing is i do not want to use a SQL DB to manage my users in this case. This is a very simple application and only 1 user will be needed. Do i need to specify somewhere to only look into web.config for user creds? if so how? Im using IIS7 .NET 4.0 to serve the page.
EDIT:
Here is the Stack Trace
[SqlException (0x80131904): A network-related or instance-specific error occurred while establishing a connection to SQL Server. The server was not found or was not accessible. Verify that the instance name is correct and that SQL Server is configured to allow remote connections. (provider: SQL Network Interfaces, error: 26 - Error Locating Server/Instance Specified)]
System.Data.SqlClient.SqlInternalConnection.OnError(SqlException exception, Boolean breakConnection) +5009598
System.Data.SqlClient.TdsParser.ThrowExceptionAndWarning() +234
System.Data.SqlClient.TdsParser.Connect(ServerInfo serverInfo, SqlInternalConnectionTds connHandler, Boolean ignoreSniOpenTimeout, Int64 timerExpire, Boolean encrypt, Boolean trustServerCert, Boolean integratedSecurity) +341
System.Data.SqlClient.SqlInternalConnectionTds.AttemptOneLogin(ServerInfo serverInfo, String newPassword, Boolean ignoreSniOpenTimeout, TimeoutTimer timeout, SqlConnection owningObject) +129
System.Data.SqlClient.SqlInternalConnectionTds.LoginNoFailover(ServerInfo serverInfo, String newPassword, Boolean redirectedUserInstance, SqlConnection owningObject, SqlConnectionString connectionOptions, TimeoutTimer timeout) +270
System.Data.SqlClient.SqlInternalConnectionTds.OpenLoginEnlist(SqlConnection owningObject, TimeoutTimer timeout, SqlConnectionString connectionOptions, String newPassword, Boolean redirectedUserInstance) +195
System.Data.SqlClient.SqlInternalConnectionTds..ctor(DbConnectionPoolIdentity identity, SqlConnectionString connectionOptions, Object providerInfo, String newPassword, SqlConnection owningObject, Boolean redirectedUserInstance) +232
System.Data.SqlClient.SqlConnectionFactory.CreateConnection(DbConnectionOptions options, Object poolGroupProviderInfo, DbConnectionPool pool, DbConnection owningConnection) +5023255
System.Data.ProviderBase.DbConnectionFactory.CreatePooledConnection(DbConnection owningConnection, DbConnectionPool pool, DbConnectionOptions options) +33
System.Data.ProviderBase.DbConnectionPool.CreateObject(DbConnection owningObject) +524
System.Data.ProviderBase.DbConnectionPool.UserCreateRequest(DbConnection owningObject) +66
System.Data.ProviderBase.DbConnectionPool.GetConnection(DbConnection owningObject) +479
System.Data.ProviderBase.DbConnectionFactory.GetConnection(DbConnection owningConnection) +108
System.Data.ProviderBase.DbConnectionClosed.OpenConnection(DbConnection outerConnection, DbConnectionFactory connectionFactory) +126
System.Data.SqlClient.SqlConnection.Open() +125
System.Web.DataAccess.SqlConnectionHolder.Open(HttpContext context, Boolean revertImpersonate) +95
System.Web.DataAccess.SqlConnectionHelper.GetConnection(String connectionString, Boolean revertImpersonation) +206
System.Web.Security.SqlMembershipProvider.GetPasswordWithFormat(String username, Boolean updateLastLoginActivityDate, Int32& status, String& password, Int32& passwordFormat, String& passwordSalt, Int32& failedPasswordAttemptCount, Int32& failedPasswordAnswerAttemptCount, Boolean& isApproved, DateTime& lastLoginDate, DateTime& lastActivityDate) +827
System.Web.Security.SqlMembershipProvider.CheckPassword(String username, String password, Boolean updateLastLoginActivityDate, Boolean failIfNotApproved, String& salt, Int32& passwordFormat) +105
System.Web.Security.SqlMembershipProvider.ValidateUser(String username, String password) +106
System.Web.UI.WebControls.Login.AuthenticateUsingMembershipProvider(AuthenticateEventArgs e) +60
System.Web.UI.WebControls.Login.OnAuthenticate(AuthenticateEventArgs e) +129
System.Web.UI.WebControls.Login.AttemptLogin() +127
System.Web.UI.WebControls.Login.OnBubbleEvent(Object source, EventArgs e) +101
System.Web.UI.Control.RaiseBubbleEvent(Object source, EventArgs args) +37
System.Web.UI.WebControls.Button.OnCommand(CommandEventArgs e) +125
System.Web.UI.WebControls.Button.RaisePostBackEvent(String eventArgument) +167
System.Web.UI.WebControls.Button.System.Web.UI.IPostBackEventHandler.RaisePostBackEvent(String eventArgument) +10
System.Web.UI.Page.RaisePostBackEvent(IPostBackEventHandler sourceControl, String eventArgument) +13
System.Web.UI.Page.RaisePostBackEvent(NameValueCollection postData) +36
System.Web.UI.Page.ProcessRequestMain(Boolean includeStagesBeforeAsyncPoint, Boolean includeStagesAfterAsyncPoint) +5563

Answer 1

The error is not related to form authentication.
Look at the connectionStrings section and ensure all SQL Server details are correct, in particular the Server section.
The error indicates that when trying to connect to SQL Server, the machine cannot locate the named server.