Hi Kristen - where did you give permission to the ags account? In SQL Server, or on the geodatabase in ArcCatalog?
The permissions I've set for SQLEXPRESS are...
agsadmin - server roles are public and sysadmin
Permissiosn on the geodatabase in SQLEXPRESS are..
Owned Schemas - agsadmin
Role Members are db_datareader, db_datawriter, db_owner
I also checked on ESRIAdmin, ESRIReadData, and ESRIWriteData just to see if that would help, but it didn't.
In ArcCatalog, I have the asgadmin user as a server administrator on SQLEXPRESS.
Is there anywhere else I should be checking?