FreeBSD 8 and Samba password issue

I am clueless. Now several weeks on this following issue.
Building a NAS box (previously on OpenSolaris, working but not my favorite choice)
I installed FreeBSD standard with Samba out of the box. Just configured user&groups, a shared drive. Samba daemon's start without errors but when logging in from remote clients or local smbclient, timeout errors occur.

Strange thing is, when adding in smb.conf 'encrypt passwords = no' it turns alive!
Has anybody seen this behavior from out of the box FreeBSD and Samba package installed??? What requisites exists for Samba and encrypted passwords on a FreeBSD 8 box?

Any help is GREATLY appreciated
 
Seriously, weeks of investigating. Then finally a post on this forum. Guess what...
Found in the logs (after raising the loglevel in smb.conf) a weird message that hostname cannot be found!?!?!
Gave a quick edit to /etc/hosts and... it works!
 
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