The try later message only happens if you enter correct credentials and the account is temporarily locked due to password attempt failures.
I'm not convinced you are entering correct credentials based on inspecting a database file with Notepad. I would download the .sdf file and try to inspect the data with WebMatrix.
As far as I know there is no difference in behavior for SQL CE vs SQL Server, the only difference in solving this problem is how you get to the data, with SQL CE you need a tool like WebMatrix with SQL Server you use SQL Management Studio.
Hope it helps,
Joe