Error Event ID 529 when IPhone tries to connect to exchange server 2003

ArgTech
ArgTech used Ask the Experts™
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I have a client that bought an IPhone and Im trying to help him to connect it to exchange that I have running on a SBS2003.
I was able to set up activesync and mobile access on the server that I also have SP2 on it.
When I set up the exchange account on the IPhone I get an error message that says: Exchange accoutn verification failed
on my Exchange Server I get on the Event Viewer:
Event ID: 529
Reason Unknown user name or bad password
Username: mydomain/myuser
Domain: mydomain

Looks like the device is reaching the server but wont connect for some reason. Any Ideas? I seen a lot about this IPhone settings but cant figure out my problem yet.

Thanks for your Help!

PS: funny that I was reading the manual on how to set this up on apple's website and the first line on the manual says "Iphone and ITouch are designed to EASILY integrate with your enterprise system"
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Commented:
It is easy to integrate if it has been setup correctly on the server.
I would suggest that you start with the Microsoft test site and a test account. Confirm that everything is setup correctly.
https://testexchangeconnectivity.com/

Simon.

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