bedna, that is not a "putty only" behavior.
Attached the verbose output using the Win11 ssh client - same same
I see only to pull the SD card, mount it on another linux system and then have a look at the ssh server and general system settings
edit: i put that sd card into another SBC (odroid hc4), mounted that card, chroot, gave a passw to root, created another superuser etc. no change - ssh does not recognize any of these users. This is bad for morale..
ssh1.txt