Per Jan 2005 thread, you may need to turn off transaction and/or assign error handler callback sub when connecting to replication server. OTOH if you can connect to replication server without encryptPassword and can execute a command successfully, then I don't see how that advice would help.

(Some of the bug reports are available on Michael P's (maintainer's) website, e.g. 441: amdmin who,sqm fails while in a transaction, 2002.)