what i did to make things work again was to rename the DATABASE folder to DATABASE.OLD and go to the Arcserve2000 CD install disk and basically repaired any of the files that were missing, kinda like a new install. That would put back in a fresh install of the database from scratch. I ran several backups and did NOT notice the failure to login into the database anymore. I also noticed that the temp folder on the arcserve folder was filled with *.CAT files. I deleted them. I ran a backup and noticed that arcserve removes the .cat file when it puts the job into the database. My belief is that when you get the cannot login to the database, thats a sign of database corruption.