Only sudo ajaxterm rather than default /etc/init.d allows logins

Binary package hint: ajaxterm

First things first, the full title of this bug is:
ajaxterm 0.9-2 only allows logins if invoked by "sudo ajaxterm" (root) rather than through "[sudo] /etc/init.d/ajaxterm start" or by a user

However, launchpad.net kept getting internal server errors and/or timing out on trying to submit this one for days with all sorts of browsers (Firefox 2.0.0.3 through Konqueror all the way back to lynx and w3m) until I realised it has an issue with summaries longer than a few words - latest OOPS-502A512 for those with an account on the launchpad-users mailing list... (if the server can't handle this an input http://www.w3.org/TR/html401/interact/forms.html#adef-maxlength limit seems indicated).

But back the bug (found using Ubuntu 7.04 "Feisty Fawn"):

The default installation of ajaxterm starts it via "/etc/init.d/ajaxterm start", resulting in a "Login: " prompt at http://localhost:8022 which cannot actually be used to log in: Any user name entered there will only result in this prompt reappearing, without even anything adverse (such as authentication failures) reported in the logs.

While "Login: " may look promising, for a functional ajaxterm on a given machine (assuming "penguin" for the purposes of this report) the real login prompt actually permitting a user to authenticate would be "penguin login: " rather than the former.

When issuing "/etc/init.d/ajaxterm stop" and subsequently invoking "sudo ajaxterm" (or even - heaven forfend ;-) - being root <gasp> as one could after setting a "sudo passwd root"), the appropriate "penguin login: " appears at http://localhost:8022 and does work as intended.

This might be an issue with Ubuntu's notorious aversion to "root" (or even patches to avoid this user), or simply any other distribution-specific privileges issue unbeknownst to http://antony.lesuisse.org/qweb/trac/wiki/AjaxTerm as of yet.