Symptoms

When trying to add a new SQL server service instance, the following error appears:

Validation Error
ExecuteReader requires an open and available Connection. The connection's current state is closed.
 

Diagnoses

The error only occurs when registering the service instance against certain Databases.

Those Databases having the errors had more items (i.e. Tables, Views, Stored Procedures) than those that didn't have the error.

The error occurs around 30 seconds after the "Add" button was clicked, which is also the default command timeout value.
 

Resolution

Increase the Command Timeout value from 30 to a larger value (i.e. 300) on the SQL Service Instance configuration page, and then try adding it again.