Comment 15 for bug 433846

Andrew: You're right.. I got everything installed and got to point of compiling bzr and it stopped me saying it also wanted Visual Studio 2003 installed... :(

Anyhow, if it wasn't obvious by Andrews post. If you are having this problem on Gentoo system a work around solution

edit /etc/ssh/sshd_config and change PasswordAuthentication from no to yes

Then restart (/etc/init.d/sshd restart) ssh. Doing this got me working :)