I am not an expert in microsoft products, but I see no reason why it wouldn't work.
Download the jdbc driver at: http://msdn.microsoft.com/data/ref/jdbc/
And have a look at the tutorial creating database server types and datasources at: http://developers.sun.com/prodtech/javatools/jscreator/learning/tutorials/2/dbs erversources.html
I've been using the MS SQL 2005 JDBC driver insides of JSC for a while now. It mostly works. The only problem I've seen is that trying to do much with the SQL editor in JSC causes the application to hang. Because of this, I do all of my SQL string editing in Query Analyzer or Enterprise Manager and just paste it into the command properties.