The difference between these 2 versions, is that the newer one starts the SMTP session with an "EHLO" command and falls back to "HELO" if the server does not support it. The other difference is that older PopGrabber versions did not send the hostname after the HELO command. We suspect your email server is not expecting this.
To check for problem 1: Make a telnet to your SMTP Server and send a "EHLO testserver". Post the response from the server here.
To check for problem 2: Extract the updated MailLibrary to your installation directory, this version will write in the log file the hostname of the PopGrabber machine.
The fast solution: Extract MailLibraryHELO.zip to your PopGrabber installation directory. This version does not implement extended SMTP (like the older PopGrabber versions).
Let us know if this helps.