bad username and password
I noticed you manually installed the client agent on a remote host and you cant login. Can you veirfy that the universal agent service is started and that port 6050 is opened in both directions between the servers involved.
Did you add the host object under windows system in the backup manager?
If so did you add it by hostname or IP address?
To work around the login failure you could try using password security in the agent admin gui, configuration, set a password and cycle the universal agent service. Then in the backup manager when promted for security enter the password in the username and password fields. see if this works , If it does then you verifed that ARCserve can make a connection and you can focus on the user account.