REAPI fails on testconfig with Specified SQL server not found or Timeout Expired

When viewing the testconfig page,  you will see REAPI failing with:

System.ApplicationException: Error loading attributes: Startup Error: General ODBC Error: [Microsoft][ODBC SQL Server Driver][TCP/IP Sockets]Specified SQL server not found. Native error:6 [Microsoft][ODBC SQL Server Driver][TCP/IP Sockets]ConnectionOpen (Connect()). Native error:11004 Main Startup Step: CBBStartSeq.Startup Start Sequence Step: ConnectToDB
at Blackbaud.Web.Content.Core.AttributeHelper.GetAttributeTypes(bbAttributeRecordTypes type)
at Blackbaud.Web.Content.Core.ConfigurationValidator.RE7ServiceToRE7API()

Or:

System.ApplicationException: Error Loading Attributes: Startup Error: General ODBC Error: [Microsoft][ODBC SQL Server Driver] Timeout Expired Native error:0 Main Startup Step: CBBStartSeq.Startup Start Sequence Step: ConnectToDB
at Blackbaud.Web.Content.Core.AttributeHelper.GetAttributeTypes(bbAttributeRecordTypes type)
at Blackbaud.Web.Content.Core.ConfigurationValidator.RE7ServiceToRE7API()

1. Locate the SQL Drivers on the Raiser's Edge 7 Web Service Server by going to the following location in the Registry (DO NOT MAKE CHANGES):

HKEY_LOCAL_MACHINE\SOFTWARE\ODBC\ODBCINST.INI\SQL Server

Note : Incorrect changes to registry settings can cause serious system problems that may be irreversible without reinstallation of the operating system. You must back up your registry before making any registry changes. We are not responsible for damage resulting from incorrect use of the Registry Editor.

2. View the Driver and/or Setup registry keys in the above location. 
Note:  Default is C:\WINDOWS\system32\SQLSRV32.dll

3. Give "Network Service" Read and Execute permissions on this file.

Environment

 6.15 ; 6.1

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