No shell from utelnetd

I have a TRENDnet TEW-635BRM router and I've found a hidden web page
that allows me to enter system commands.  I can see that it's running
BusyBox v1.1.0 and that the Linux kernel is as follows:

Linux version 2.6.8.1 (root@pbsa) (gcc version 3.4.2) #1 Wed Aug 19
14:16:29 CST 2009

I'd like to gain the ability to telnet into the device, but my
attempts so far have failed.  The BusyBox build does not include
telnetd, but I found utelnetd in /usr/sbin:

-rwxr-xr-x    1 root     root        14304 Aug 19  2009 utelnetd

When I run this, it starts with "telnetd: starting port: 23; login
program: /bin/login" which allows me connect but I don't get a shell.
Nothing happens, characters I type are just echoed back.  I found the
following posting which exhibited the same symptoms, but no solution
was offered:

http://groups.google.com/group/comp.os.linux.embedded/browse_thread/thread/5fb2f4dc85afa30d/6e31ad9b9ed15441

BTW, the symbolic link bin/login -> busybox.  I've tried everything to
get this working, but to no avail.  I see the passwd file has root and
nobody defined.  Does anybody have any ideas why the telnet daemon
isn't allowing me to login?