Can't run non-UNICODE-DbSl against UNICODE database

Hi everyone. I get this error during the update of Solution Manager 7.1 SPS4 (dual stack) to SPS10. It is a green install. This happens during the
phase PREP_EXTRACT/PREIMP! Of the ABAP stack. Step 5.2. I do not see a lot of people with this problem, so I assume it is something I am doing wrong, as it is my first time using the tool SUM.

Details of the system:

• Solution Manager 7.1 SPS4
• Windows 2008 R2 64 bit
• Microsoft SQL 2008 R2 64 bit SP1
• Central installation type with all components on
  the same host
• Kernel level 600

Here is what I have done so far:

• Downloaded the media as described in the installation
  guide.
• Worked my way through the install using the
  Software Provision Manager 1.0
• Updated the Kernel from level 401 to 600, by
  copying the files from the download folder to the F:\usr\sap\SM1\SYS\exe\uc\NTAMD64
  folder. This is the folder that is assigned to the DIR_CT_RUN parameter.
• I start the STARTUP.BAT file in the SUM folder.
• I then start the SUM GUI and run through the
  steps and in step 3 I map the Stack configuration file (XML) to one listed in
  the folder “51047130\DATA” called “SPS10_stack.xml”
• Then I
  get to 5.2 where the system stops with this error:

Severe error(s) occurred in phase PREP_EXTRACT/PREIMP!
Last error code set: Single errors (code <= 8) found in logfile 'PREIMP.ELG'

ERROR: Detected the following errors:
# F:\usr\SUM\abap\log\R710VPE.<DB>:
      4 ETW000 TRACE-INFO: 19:  [    dev trc,00000]  Driver: sqlncli10.dll Driver release: 10.50.2769                                3938  0.039733
      4 ETW000 TRACE-INFO: 20:  [    dev trc,00000]  GetDbRelease: 10.50.2769.00                                                      1603  0.041336
      4 ETW000 TRACE-INFO: 21:  [    dev trc,00000]  GetDbRelease: Got DB release numbers (10,50,2769,0)                                21  0.041357
      4 ETW000 TRACE-INFO: 22:  [    dev trc,00000]  Can't run non-UNICODE-DbSl against UNICODE database                              2647  0.044004
      4 ETW000 TRACE-INFO: 23:  [    dev trc,00000]  CheckCodepageType failed. Connect terminated.                                      13  0.044017
      2EETW169 no connect possible: "DBMS = MSSQL                            ---  SERVER = '<SERVER>' DBNAME = '<DB>'"

Can
anyone please help?

PS:
The admin user that I use do have access to the database. It is listed with
sysadmin role and the default DB is the Solution Manager db.