Note: Sometimes after step 4 the browser page is the page that says password incorrect and goes on to ask about caps locked, etc. This is the same page that would sometimes show up in the old UI when changing from one mode to another or going to or returning from Options page. This was inconsistent on the old UI — didn’t always happen, but after a page refresh all would start working again.
Here are some things you can try to help us debug:
1) Try a different browser (Chrome, FireFox, Opera, etc).
2) Try an available application (iOS, Android, or any other platform, including Windows 8)
Update: Using IE9 (not emulated) I am able to reproduce this. Give me a minute to identify and fix the issue.