Well, let's first start with the basic stuff. Do you even want the IDENTITY property turned on? Do you want SQL Server to automatically generate values for your ID column? If you do, then that Identity option in EM must be set to Yes and then you must NOT send values to it on inserts from your application. So you exclude that column in your column list.
Identity set to Yes is what you want. Now the problem is with your application. Are you doing your queries through stored procedures or embedded t-sql? Please post the queries. You need to exclude your ID column from the query so that SQL Server handles the data for it. Also, post the name of the ID column unless of course if it's just ID which isn't a very good name if that's what you have chosen, best to use TableName_ID or something like that.
It appears you have a table with an IDENTITY column and you're trying to INSERT an explicit value into that column. Usually when you have an IDENTITY column you don't insert that value and SQL Server supplies the next value in sequence. You can SELECT back that value by doing a SELECT SCOPE_IDENTITY() right after the INSERT.
If you truly do want to INSERT an explicit value into an IDENTITY column do it like this.