Not sure if this will help, but it is easy enough to try --
Connectionstrings.com and
this MSDN forum seem to suggest putting the password into the connection string like this:
PROVIDER=Microsoft.SQLSERVER.CE.OLEDB.3.5;ssce:database password=test;
+Data
Source=C:\temp\testcompact3.sdf
Provider=Microsoft.SQLSERVER.MOBILE.OLEDB.3.0;Data Source=myPath\myDat
+a.sdf;
SSCE:Database Password='myPassword';
...it is unhealthy to remain near things that are in the process of blowing up. man page for WARP, by Larry Wall