We had the exact same problem. Unable to create a locator in arcsde 10.3 SQL database, but able to create the locator in a file geodatabase. Then tried to copy the locator from the file geodatbase to arcsde as Steven suggests and got the same error as Shawna: However, just by clicking "OK" to get rid of the error message and immediately right-clicking and selecting copy again (into the sde database), the copy works. Weird problem, but it seems consistent -- always fails on the first attempt to copy, but works on the second attempt.
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