If PhonePad tries to connect to your Server at 127.0.0.1 then something is definitely not working correctly.
Are you using a VPN (Virtual Private Network)? If you are, this can cause issues with PhonePad's Auto-Discovery feature.
To correct this, follow these steps:
1.On each workstation, go to C:\PhonePad5.
2.Open the WorkstationConfig program.
3.Select Disable Auto-Discovery of Server.
4.Enter the correct IP Address for the Server.
5.Click the Save button.
6.Click the Exit button.
When you start PhonePad now it should successfully connect to your PhonePad Server.