This was the error message that confronted one of TechNet Forum customers when they were trying to upgrade there VAS from 126.96.36.199 to 188.8.131.52. And its a really interesting issue!
All you get when you try and upgrade is an error message saying "The installation program was unable to read the SQL. upgrade files for the configuration database".
This is due to the installation program being unable to read the SQL upgrade files for the configuration database, if you review your sft-server.log you should see an entry similar to ;
Couldn't open search handle for path ``C:\Program Files\Softricity\SoftGrid Server\schema\upgrade\*''.
Generally I have seen this where the customer had installed the SoftGrid VAS to an alternate location. For example E:\Microsoft\SoftGrid Server rather than the above path.
Reviewing the SoftGrid-server-setup.txt to spot the error and the installation rollback.
When we copied the data from the 'E:\Microsoft\SoftGrid Server\schema\upgrade' to the path 'C:\Program Files\Softricity\SoftGrid Server\schema\upgrade\*'' after we manually created the directory structure on C:. The installation then completed successfully.
There are several folders under the 'upgrade' folder and the number is based on how many upgrade the customer has done. The names there represent each version installed (3.1, 3.2 4.0 ect...). The data under the 'upgrade' folder is the data that needs to be moved\copied.
Also check the following keys and ensure the path is pointed to the correct installation. Editing may allow the application to install correctly. (But this has not been tested in full)