There isn't a whole lot of information on using Service References over Web References when it comes to passing in username and password credentials. 

Normally with a Web Reference you'd do this:

            MyWebRef.MyClient webClient = new MyWebRef.MyClient();
            NetworkCredential credentials = new NetworkCredential("myUser", "myPassword");
            webClient.Credentials = credentials;

The Alternative code to that:

            MyServiceRef.MyClient client = new MyServiceRef.MyClient();
            client.ClientCredentials.UserName.UserName = "myUser";
            client.ClientCredentials.UserName.Password = "myPassword";

While this may not seem much different, it isn't immediately obvious where to look for setting the username and password inside the Service Reference.