SQL Anywhere is a real relational database engine. It is NOT a shared file db like Access, Foxpro, dBase, etc.
Second, you have to have the correct version of SQL Anywhere OR one that will automatically upgrade your database. WARNING: make a copy first. Once you upgrade your database, your old application may break.
Third, after you have created a database and started the SQL Anywhere engine, you can go tot he ODBC administrator and enter the network information. Forget the file stuff; that is only necessary if you are going to try and start the database from the ODBC driver which I do not recommend.
The SQL Anywhere doc show you how to create a new database or upgrade an existing one. Sorry, I don't have the syntax and procedures handy off the top of my head.
Regards,
Bill