OK, so I found that suidperl is installed on the remote server that the login failures are happening on. It is NOT on the local server, or the host1 which is working.

Because of the error that is given, and the difference of suidperl being installed, I am going to assume that's where my problem is at the moment. Unfortunately, I don't have enough access on the remote server to disable/un-install it.

From what I have read (admittedly a very fast read through), suidperl changes the user that the script runs as. I am confused as to whether it automatically runs it as root, or tries to make it run as the id that started the script on the local server. I suspect it tries as root because it doesn't even list user/pass pair in the auth methods it would attempt to try (root login disabled). Although, I did try and create a local id matching the login id of the remote server and running it that way, but still the same error.

I am confused as to why this would affect it before the login is complete though.

So, for the time being, I believe I am stuck. I'm off to learn more about suidperl and possibly Expect (and I've tried for two years to avoid Expect :-D ).

Thanks so much for the pointers, and if I come up with something new to try, I will post back and let everyone know how it worked out.