Actually, I think where you missed this was that you didn’t follow the links on that http://wiki.dreamhost.com/SFTP page you were reading to get the “full story”.
Note that the pages states:
[quote]Requirements and Setup
To use SFTP, the user account you want to access must be configured with the proper account type. You can do this in the control panel under (USERS > MANAGE USERS) then clicking on the “Edit” link for the user account in question.
Then select either of these “User Account Type:” options.
- “Shell account - allows FTP plus ssh/telnet/sftp access.”
- “SFTP account - sftp (SSH ftp) file transfer access only.”
Please see Enabling Shell Access for full instructions on how to do this. [/quote]
Had you tried the method in the first paragraph above, you would have been “editing” an existing user instead of creating another. Had you followed the link above, you would have seen sections for both options (make an existing user SFTP capable, or make a new SFTP/SSH capable user).
I’m not sure how to make that more clear, but I am open for suggestions.
(edited because I found the page he was looking at - doh! Hey, it’s been a long day)
–DreamHost Tech Support