My problem was probably caused by opening a different web application site, than another instance of SharePoint designer, and logging in with my test login account (different than my main account), or maybe it was because I was logging in to the web site multiple times, but one of them was with my test login account (with different credentials). The above fix that was suggested of logging to the site with a different user works, but is not a good fix, because I had to temporarily set my test login account to Site Collection administrator. Then I can change user to the correct user, and it will let me log in. But no matter what I do, whenever closing and restarting Sharepoint Designer 2010, its always trying to login to the test Login account now.
I don't know how to change Sharepoint designer to user my main account first!
--> Solved it! I noticed that when I run Internet Explorer, and hit the same URL / Site, that my login was showing up with my test user! So to fix, I logged on as my correct user and clicked on true for "Remember my credentials", and typed in my password. Then I did "Sign off" from site (not sure if this step was important or not. Then Exited Internet Explorer. Then re-launched Internet Explorer, and ran my site/url - now its showing my correct user! Exit Internet Explorer, and run SharePoint Designer 2010 - now when I open the same URL / site, its logging on with my correct user!
What's weird about this is that I tried this same sequence with SharePoint Designer 2010, but its not saving the default user changes, just works correctly when done from Internet Explorer!
Never login as a different user to a Sharepoint in Internet Explorer and while Sharepoint Designer 2010 is open! Something like this caused the problem!