I've been trying to set up vsftpd on my unslung nslu2 following the wiki at NSLU2-Linux - Optware / Vsftpd browse

Despite following all the tricks I can't get local users to log in - with everything set as it (apparently) should be I get:

STATUS:>  	Connected. Authenticating...
COMMAND:>	USER jaydublu
		331 Please specify the password.
		500 OOPS: bad state in vsf_one_process_login
Can anyone advise?