Nope. Not the problem. The ISP uses fetch before send authentication.There is also a 3rd problem. Your SMTP server may require authentication (in fact most ISPs do) so you probably want to check that box.
No such luck. Attempting to connect directly to the ISP, without using POPFile, only using the instructions from the web page I linked to in my last post, produces the exact same error message.I agree that the error message is not clear. We'll make the error more friendly.
BTW I just trying setting up a bunch of POP/IMAP accounts using email address as username, and they all setup just fine.
If it still doesn't work for you after you make the corrections I mentioned, we'll have to check the POP/IMAP/SMTP auth trace. Unfortunately right now there's no UI to turn trace on during setup. There's only a way to turn it on after the account is setup. There's a bug filed for this (Bug 31274 – allow user to enable debug trace from account setup page).
Wouldn't it be better if the email portion of the program were to simply pass through whatever you put into the USERNAME block without attempting to parse it? Then, it's up to the user to input the username in the format the ISP requires, and the program has nothing to do with it - it simply passes through the information exactly as the user inputs it.