I have been using Icy Phoenix for about a week now and have had this problem with 2 users....Another one seemed to not have any issues.
The e-mail link that is sent when i have User Activation enabled sends them to a link that displays the error "Forbiden. You do not have rights to access posting.php"
Something along those lines.
When I tested this myself by creating a new account, i saw it too.
I haven't done any mods to the php scripts or anything, and i don't recall doing anything that would affect registrations.
Any idea's or help would be appreciated
EDIT: I began looking through some other posts....i think the hotmail thing may be part of it, but i have tried the copy and paste and still got the same error when the mail was sent to the hotmail