Looks very similar to
http://social.msdn.microsoft.com/Forums/sqlserver/en-US/09c9a051-82e0-42e6-a677-ec5161e3961c/bcp-cannot-connect-via-local-connection-but-can-using-remote-connection?forum=sqlexpress
However, looking at the resolution to that issue, this still does not work.
SQLCMD and Management Studio are connecting fine. Environment = Windows 7 prof SP1.
Replication:
C:\>sqlcmd -S (localdb)\v11.0
1> select @@version;
2> go
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