The same issues apply to ArcSDE 10.0 as ArcSDE 10.1, except the 'sdesetup' option
is still available to create the geodatabase. IMHO, you should always install the
application server software, even if you don't intend to run a service -- especially at
10.0, where the ArcGIS doesn't have all the support utilities added at 10.1.
Do you have a 10.0sp5 geodatabase installed in the Oracle database (e.g., SDE
user created, ST_GEOMETRY installed, and SDE metadata tables present)? You
can't Direct Connect before installation is completed.
- V