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Your issue has nothing to do with not accepting the password your error is because you can not complete the install. The script tells you permissions are incorrect on your data directory.
ftp to your site and set permissions on the data and uploads directories at every level to 777 permissions and then rerun install
As far as your directory name is there any specific reason you are installing with the name twice. why not simply put it in a simple directory on your server called classifieds.
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