Multiple problems around registration submission

Hi In the final stages of migrating a Joomla 1.0.22 site to 1.5.23 and having frustrating issues with user registration. Using CB 1.4.

If I configure CB to allow user registration independently of Joomla, when submitting the form I get a 403 access forbidden error.

If I set the above to use 'same as site setting' the process works and confirm email is sent however clicking on the registration link doesn't seem to synchronize the database as when you attempt to login for the first time after activating it says activation hasn't occurred..?

Manually synchronizing users via CB tools fixes this problem. Not a long term solution though.

Possibly related - I do seem to be having an issue with mail set up as well. Mass mails appear to be sending but don't appear in inbox. PHP Mail function is set.
** Update Mass email does work. My client got her emails**

Test site
www.tangoaustralia.com.au/index.php

** There is a redirect pointing to a sub directory where the 1.0 install lives for the raw URL www.tangoaustralia.com.au

Any suggestions on what the root cause is and/or how to address it appreciated. I'm going around in circles.