Hi Aaron,
It sounds like something is out of sync...Would you be able to provide the error you receive when trying to start the service, please? Also, what were the steps used to upgrade? Something like the following?
1- Install ArcGIS Desktop 10 SP2
2- Make a direct connection to the sde geodatabase as sde user
3- Run upgrade (from the workspace properties)
Did you also install the ArcSDE 10 SP2 service pack on the sde server?
Thanks,