Comment 9 for bug 610450

You could have 3 issues. This will be the end of this problem.

1. You have not defined a webservice user in magento with all rights assigned or you have the credentials wrong

2. you have specified a wrong path for your website. http://www.site.com

3. you have improperly installed the magento side module.
a. You must get the right source for the module, not some package
b. You have to properly install it. After you place the files in the "correct" locations you must reload your system configuration so it will recognize the module as being installed. You can check if the module is installed properly by going to your system configuration in your admin panel.