Local Windows accounts fail with known good password

Prerequisites

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Steps to reproduce

Hi i have setup openssh to work with AD accounts. However now i am trying to make this work with a local account, to take AD troubleshooting out of it.

i have created a local windows user, set the password, tested the password by logging into windows as the account.

however when i try to connect via SSH client, on my laptop logged in as my AD account, it fails to login saying "Permission denied (publickey,password,keyboard-interactive)." I KNOW this password is correct.

Below is my config and ssh
sshd.log
sshd_config.txt

Expected behavior

Should allow the local account to connect

Actual behavior

Permission denied (publickey,password,keyboard-interactive).

Error details

No response

Environment data

nothing

Version

OpenSSH.Server~~~~0.0.1.0

Visuals

No response

Start by reviewing the attached sshd.log and sshd_config.txt, then reproduce the failed SSH login with the local Windows account described in the issue. Compare the server configuration and logged authentication failure with the expected successful local-account connection; done means the account authenticates without the permission-denied error.