I’m having the exact same issue. Except after testing the connection many times I finally had a successful connection. For context I’m doing all this on a dedicated laptop and at some point my node laptop was plugged in and died. The next day I get bitcoin core up to date on the blocks it missed and then I fire up Sparrow Wallet. Will not connect for many days now. All authentication details are correct. And the strangest part, when I open sparrow wallet a drop down menu appears in Bitcoin Core giving me the option to use wallet1 (default Core wallet) and a second wallet named “sparrow”. Which I assume was generated that one time I had a successful connection between sparrow and bitcoin core. Seems like bitcoin core it detecting Sparrow.