Hi,
This error message is very clear. It indicates either a mistake in your connection string or the database server is not accessible from the web server.
You should only worry about the connection string in user.config because if it is present that is what it will use, and it is better to keep it in user.config. But when you edit user.config, after you save user.config you need to touch Web.config to make it reload the settings (ie type a space in it and save it, or download it and upload it again), otherwise it won't see your new changes in user.config.
For more information about moving a site from one machine to another, see this document:
http://www.mojoportal.com/moving-an-installation-of-mojoportal-to-a-different-server.aspx
Hope it helps,
Joe