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To be able to connect to SQL*Server from SQL*Developer you need to download a third party ODBC driver.
This is detailed in the documantation -
Oracle® SQL Developer
User's Guide Release 3.2
Database: Third Party JDBC Drivers -
For Microsoft SQL Server or Sybase Adaptive Server: jtds-1.2.jar, which is included in the jtds-1.2-dist.zip download
As an alternative to using this preference, you can click Help, then Check for Updates to install the JTDS JDBC Driver for Microsoft SQL Server and the MySQL JDBE Driver as extensions.
To find a specific third-party JDBC driver, see the appropriate website (for example, http://www.mysql.com for the MySQL Connector/J JDBC driver for MySQL, http://jtds.sourceforge.net/ for the jTDS driver for Microsoft SQL Server and Sybase Adaptive Server, or search at http://www.teradata.com/ for the JDBC driver for Teradata). For MySQL, use the MySQL 5.0 driver, not 5.1 or later, with SQL Developer release 1.5.
You must specify a third-party JDBC driver or install a driver using the Check for Updates feature before you can create a database connection to a third-party database of that associated type. (See the tabs for creating connections to third-party databases in the Create/Edit/Select Database Connection dialog box.)
You also say you are using 3.0.04 but you should download and use the latest 3.2 version available from here -