I am having the same problem with the Twitter login and the Twitter user not recognized error.
I know I have the base plugin configured correctly, because I can comment using my Twitter button and it works perfectly.
I’m returning to self-hosted WP after a long time away. The changes are very new to me. I’m using 3.0.2, whereas the plugin states it is only tested to 3.0.1. As such, I feel that “wait for an update” would be a completely appropriate response ??
I’ve looked for info and will continue to look.