I'm getting the same error as Andrew who started the thread. Fresh install of DNN 7.00.06 and a SQL Server DB. The installation wizard comes up. But the message "No valid default database connection detected. Standard Database setup option is unavailable" appears. When you click custom the "SQL Server/SQL Server Express Database" option is selected but it asks for a filename. You must first select the express option and then come back to the SQL Server option and only then does it bring up the Database name field, correctly populated with the correct database name. However the big red box with the message "Object Qualifier must start with a letter and be no more than 20 characters." refuses to go away. Hit submit....just comes back. I have recreated the DB, I have deleted everything and recreated from the 7.00.06 zip file. Checked and rechecked the web.config.....

I give up.  I guess unless someone can help it's time to go back to version 6.