pam_unix(sshd:auth): conversation failed

I'm using Ubuntu 8.04 with thin clients at an elementary school. When a student types in the wrong password (which happens often), it takes over 2 minutes to get the login screen back. This is very irritating. This is an excerpt from my auth.log.

Feb 21 13:24:31 edvs sshd[28103]: pam_unix(sshd:auth): authentication failure; logname= uid=0 euid=0 tty=ssh ruser= rhost=192.168.102.103 user=ecorpsys
Feb 21 13:24:33 edvs sshd[28096]: error: PAM: Authentication failure for ecorpsys from 192.168.102.103
Feb 21 13:25:01 edvs CRON[28120]: pam_unix(cron:session): session opened for user root by (uid=0)
Feb 21 13:25:01 edvs CRON[28120]: pam_unix(cron:session): session closed for user root
Feb 21 13:26:26 edvs sshd[28108]: pam_unix(sshd:auth): conversation failed
Feb 21 13:26:26 edvs sshd[28108]: pam_unix(sshd:auth): auth could not identify password for [ecorpsys]
Feb 21 13:26:26 edvs sshd[28108]: error: ssh_msg_send: write
Feb 21 13:26:36 edvs sshd[28181]: pam_unix(sshd:auth): authentication failure; logname= uid=0 euid=0 tty=ssh ruser= rhost=192.168.102.103 user=ecorpsys
Feb 21 13:26:38 edvs sshd[28171]: error: PAM: Authentication failure for ecorpsys from 192.168.102.103
Feb 21 13:26:38 edvs sshd[28183]: pam_unix(sshd:auth): authentication failure; logname= uid=0 euid=0 tty=ssh ruser= rhost=192.168.102.103 user=ecorpsys
Feb 21 13:26:40 edvs sshd[28171]: error: PAM: Authentication failure for ecorpsys from 192.168.102.103
Feb 21 13:26:40 edvs sshd[28184]: pam_unix(sshd:auth): authentication failure; logname= uid=0 euid=0 tty=ssh ruser= rhost=192.168.102.103 user=ecorpsys
Feb 21 13:26:42 edvs sshd[28171]: error: PAM: Authentication failure for ecorpsys from 192.168.102.103
Feb 21 13:26:42 edvs sshd[28171]: Failed keyboard-interactive/pam for ecorpsys from 192.168.102.103 port 54295 ssh2
Feb 21 13:26:42 edvs sshd[28171]: Failed password for ecorpsys from 192.168.102.103 port 54295 ssh2
Feb 21 13:26:42 edvs last message repeated 2 times

Why is there 2 minutes interval between the first authentication failure and the "conversation failed" message and what does that mean.

Thank you
Kraig Ellis

/etc/ssh/sshd_config

LoginGraceTime

The server disconnects after this time if the user has not successfully logged in. If the value is 0, there is no time limit. The default is 120 seconds.

Thank you so much. I'm definitely still learning.
Kraig

After changing the timer in sshd_conf, The time changed between the time the auth failure first occurred and the time the conversation failure occured. But the overall time between entering the wrong password and being able to re-enter the password is still just over 2 minutes. This does not happen if logging in from the console or if logging in remotely. This only happens logging in from a thin client.
What is going on here?
Thanks
Kraig