Hi,
If your getting logon failed that means the report is not connected to the database. Also you have specified that you have done verify database even though your unsuccessful.
In the feild explorer select the database and right click on it, please choose "set data source selection" you can find the tables linked to your report. Please select one by one database and see the properties where the table name specified on the above and under the properties are one and the same.
If yes then please select the down the database under My Connection (or create a new connection - if the existing database is not there). Please select the table which is already used and try to update by selecting the right table (Select both tables which you have selected from the new connection or my connection and already existing table which is connected to the report) and click on update.
If you have n number of tables/query added to the report, please apply the same procedure and then try to run the report once again. Now you will be successful.
Regards,
Chid