Not sure if this will help. I had same problem/issue. Make sure the connection string info is in the connectionstring xml file found in the web folder.
Then go back and click the use information from the connectionstring file option, I believe this is step 3 but not sure. I received a version number of "not installed" after rerunning the version test but was allowed to continue with everything else with no errors.
Restart your sql server and that worked for me. The problem is some sort of code loop that doesnt "install" the database right away, I believe.....