What happens when trying to login? Page just reloads then nothing? An error is displayed? Ensure live_site in configuration.php is set to '' (empty). Be sure to be using CBs login module and not Joomlas. If issue persists enable debug mode and maximum error reporting in Joomla global configuration and see if any errors output.

Sounds like the credentials you're entering are incorrect. The "Username and password do not match or you do not have an account yet." error is a Joomla authentication error. Create a new account with username and password both set to testuser then try logging in.

I've no idea what's wrong with your existing users credentials. Passwords are encrypted by and stored by Joomla entirely. We simply pass the plaintext string to Joomla and let Joomla deal with it. Disable CBs system plugin within Extensions > Plugins and try using Joomlas login module to see if it does the same. If it does suggest posting to Joomla.org forums to see if they've anything to suggest why existing users passwords do not work.