Gareth,

Yeah I had this problem a while back, can't quite remember what I 
did to fix it unfortunately. I'm not running the 2.4 kernel but 
I had exactly the same error on stock standard RH6.2. This is
using inetd rather than xinetd, not sure if that's an issue. Here's
my working config info, maybe that will help.

The line in my /etc/inetd/conf is:

  ftp   stream  tcp   nowait  root  /usr/sbin/proftpd  proftpd

My /etc/pam.d/ftp file:

  #%PAM-1.0
  auth       required     /lib/security/pam_listfile.so item=user \
          sense=deny   file=/etc/ftpusers onerr=succeed
  auth       required     /lib/security/pam_shells.so
  auth       sufficient   /lib/security/pam_ldap.so  
  auth       required     /lib/security/pam_pwdb.so
  account    required     /lib/security/pam_pwdb.so
  session    required     /lib/security/pam_pwdb.so

Note that we use ldap authentication with proftpd via pam so you might
want to flick the auth sufficient pam_ldap line.

Here's the matching proftpd.conf (Comments removed for brevity).

  ServerName        "The scavenger"
  ServerType        inetd
  DefaultServer     on
  Port              21
  MaxClients        20 "Sorry, Maximum number of users reached (%m)"
  DisplayConnect    /usr/local/etc/proftpd_connect.msg
  Umask             022
  User              nobody
  Group             nobody
  AuthPAMAuthoritative    on
  PAMConfig         ftp
  RequireValidShell on
  PersistentPasswd  off
  <Directory /*>
    AllowOverwrite  on
  </Directory>

Note that the PAMConfig variable set to "ftp" is what matches up to the
file 
"ftp" in the /etc/pam.d directory.

This config dosesn't have the chroot gaol set (DefaultRoot), but I have
other 
servers that do so I think you are "... up a gumtree"  with that idea.

HTH

Pete

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