Is the FTP server on OS X 10.6 giving you 530 password incorrect?

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First off, verify the users password by logging in via another method (afp, smb, ssh...)
If that is a go, try replacing some stupid file that seems to get corrupt.
  serveradmin stop ftp
  cp /Library/FTPServer/Configuration/ftpaccess to a backup file
  then copy the ftpaccess.default to the ftpaccess file.
  serveradmin start ftp

It looks like they "fixed" it in 10.7 by removing the gui config tool, and changed out the ftp server used.
They now need this:
Hint if that link breaks: - start it from a shell.