I am creating a new read/write user on SQL Azure as follows:
-- Connected to master
create login [fred] with password = \'xxx\';
-- Connected to my DB
creat
By default, SSMS tries to connect to master, but your new account does not have access to master; only the user database I presume.
On the login screen of SSMS, you need to specify the database name as well; just click on the Options >> icon, which opens up the Connection Properties tab. In there, specify the database name you are trying to connect to.