Solved, /home perms where wrong.
It would be nice to have openssh say a bit more about this problem in logs on DEBUG3, then just
Jan 10 00:54:16 vz1947 sshd[32763]: debug1: trying public key file /home/userfoo/.ssh/authorized_keys Jan 10 00:54:16 vz1947 sshd[32763]: debug1: restore_uid: 0/0
Solved, /home perms where wrong.
It would be nice to have openssh say a bit more about this problem in logs on DEBUG3, then just
Jan 10 00:54:16 vz1947 sshd[32763]: debug1: trying public key file /home/userfoo/ .ssh/authorized _keys
Jan 10 00:54:16 vz1947 sshd[32763]: debug1: restore_uid: 0/0