My wife recently purchased the glorious Samsung Galaxy SII; setup was a breeze until I tried connecting it to Exchange.
I kept getting the username and passwords do not match even though they were correct; being lazy I thought it was something I had misconfigured so I deleted the profile and started again; same error!
Did a quick Google hoping to find a solution and found lots of people with the same error; so I started digging a bit more (which was easy because I manage our Exchange environment!)
In order for Exchange integration to work on a mobile device it uses ActiveSync which is SSL and port 443 onto the Exchange Server.
If you login to Exchange OWA; Options you should see something like this; click phone and your devices will be shown to the right.
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As you can see the Samsung SII did actually connect to the Exchange Server but something happened that prevented the device from fully connecting;
What I suspect had happened was the phone did not have a pin or complex password for the Unlock screen as by default a security policy will be sent down to the phone even if the Exchange security policy is blank; the user must then accept the policy which then gets applied and the phone is accepted for ActiveSync.
In my situation this still did not work; what did work for me was removing the device from Exchange;
Select your Phone as follows;
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And carefully select the X (delete) icon as shown in red below; this will not wipe or do anything to your Phone; rather its removing the device from your Exchange profile.
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Once this has been removed; power off and back on your phone and complete the email process again; hopefully all should work. You should also accept the Exchange Security Policy and after a few minutes your emails should start to Sync.
I have noticed this scenario a few times with other Android devices and I suspect its either a bug or the device is not fully supporting Microsoft’s ActiveSync (which is licensed by the phone provider).
One other last tip; the username has to be domain\username don't get confused by the label of Domain: Username.
I hope this helps.