Hi Balaji,
That is precisely the point, I was hoping that these two authentication areas (connection to BW and sap sso) would work independently when not using the connection in SSO, given that one has a choice of using SSO when setting up that connection:
In our case, the faulty sap sso (entitlement) configuration was preventing connections configured as Pre-defined. It would be expected if this was happening for SSO connections, but the error happened when using Enterprise accounts and Pre-defined connections, and this seems to be a bug.
To answer your query more specifically, I expect you should be able to have different SAP IDs for your entitlement system and for Pre-defined OLAP connections, because that seems to be the point of allowing the Pre-defined option. However, what we observed here was that a problematic sso configuration was having an unexpected effect on the (Pre-defined) OLAP connections, so I cannot guarantee that the expectation would be confirmed. In our case, we deleted the entitlement system configuration because we don't need sap sso, and that is when the OLAP connections started working again.