If deleting the
makes it all work, I am guessing that your user.properties file has the passwords in plain text. The reason for using an MD5 hash is so you do not have plain text passwords in the user.properties file.
If you hash the passwords in user.properties then it should work.
Some quick and dirty code to create hashes can be found in the topic below:
http://www.jboss.org/modules/bb/index.html?module=bb&op=viewtopic&t= this helps. Let me know how you get on.