I installed Service Pack 2 for Crystal Reports Server 2008 because it utilizes a newer version of the Salesforce.com API, which is required to access new custom objects created in Salesforce.com.
I also had to install Fix Pack 2.7 to get this updated API in Crystal Reports 2008 designer.
Now, i can create reports in the Designer using these new custom objects (previously they were not visible in the Database Expert), but when I upload them to Crystal Reports Server 2008 V1 SP2 and try to run them i get the error:
"The database logon information for this report is either incomplete or incorrect."