I recently needed to move an ArcSDE Personal database file from my local hard drive to another location. The directory where the MDF and LDF files are located is different on the target computer. This caused problems when attempting to attach the database in ArcCatalog. I received the following error message:
Problem selecting this Geodatabase file
File activation failure. The physical file name
"C:\GIS Data\MyDatabase.LDF" may be incorrect.
It seems that ArcCatalog does not figure out that log file has moved along side the MDF file. To solve the problem, I attached the database using SQL Server Management Studio, which automatically fixes the path to the LDF file.
But this created a second problem. Now that the database is attached to the local SQLEXPRESS instance with Management Studio, attempting to attach it in ArcCatalog causes this error:
Problem selecting this Geodatabase file
CREATE FILE encountered operating system error 32(The process cannot
access the file because it is already being used by another process.) while
attempting to open or create the physical file 'D:\GIS
Data\MyDatabase.mdf'.
This was easily solved by detaching the database in SQL Server Management Studio and then attaching it in ArcCatalog.
Summary
To move an ArcSDE Personal database to a new location with a different directory path, first attach the MDF file to SQLEXPRESS using SQL Server Management Studio. This will fix the broken path to the log file. Then detatch the database and attach it in ArcCatalog.
Hope this helps!