I got it all working now. Thanks guys you really helped me out on this.
It was the versions of the SQL CE that was messing things up.
I uninstalled everything then reinstalled SQL CE 4 x64, 3.5 x86 and x64 (all the latest versions from MS)
Then installed the CRM client and the 12 rollup for the client.
It all worked then.
What a crazy install to get things working.
Thanks again.