Rick:
Are you sure the user's shell is listed in /etc/shells?
It isn't (I didn't know about this - just found it in the readme).I use the shell supplied - gnome terminal (no reason to change). The readme states that I could use 'ftp' as a shell.
So, this affects login? (Considering that it works as a standalone.)
Also, verify the user is NOT listed in /etc/ftpusers.
That file doesn't exist.