Esri is now providing a tool to create an ArcSDE Connection File wherever you would like on your file system. The tool is located in the standard toolbox under Data Management -> Workspace -> Create ArcSDE Connection File.  Here’s a look at where it’s located, and what it looks like when filled out:

This tool is only available to users running a Standard (ArcEditor) or Advanced (ArcInfo) license level.  Users of a Basic (ArcView) license will need to download the connection file, available in a link below.

You can save the connection file anywhere you’d like, but if you want to see the connection in the Database Connections folder in ArcGIS Desktop, you’ll need to save it to this location: C:\Users\[Your User Name]\AppData\Roaming\ESRI\Desktop[version]\ArcCatalog

It should be noted that the AppData folder is most likely hidden by default. In Windows, you can make it visible by going to Control Panel, Folder Options, choosing the View tab, and enabling Show hidden files, folders, and drives from the Hidden files and folders area. (Thanks Doug!)

Just replace the entry [Your User Name] and [version] with your login name and the version of ArcGIS Desktop you are using.

Instructions for Basic (ArcView) license level users

If you’re using a Basic license for Esri’s desktop product (ArcView), and wish to connect to the SGID, you’ll need to download a connection file from our FTP site:

ftp://ftp.agrc.utah.gov/ApplicationServer/ArcGIS_Connection_File/ConnectSGID10.sde

You can save the connection file anywhere you’d like, but if you want to see the connection in the Database Connections folder in ArcGIS Desktop, you’ll need to save it to this location: C:\Users\[Your User Name]\AppData\Roaming\ESRI\Desktop[version]\ArcCatalog

It should be noted that the AppData folder is most likely hidden by default. In Windows, you can make it visible by going to Control Panel, Folder Options, choosing the View tab, and enabling Show hidden files, folders, and drives from the Hidden files and folders area. (Thanks Doug!)

Just replace the entry [Your User Name] and [version] with your login name and the version of ArcGIS Desktop you are using.