IIS FTP server? have not seen such error before from IIS. is that the correct error msgs?
how about you physically login to the w2k3 machine or via remote desktop, open the local command prompt and connect again via ftp.exe
typically 530 would indicate user unable to login due to bad password, no logon rights, etc. try -
Err Msg: 530 User <Username> Cannot Log In. Login Failed.
http://support.microsoft.com/?id=200475