I have had this problem also in a similar (NAT) setup. ISAKMP would not work but Manual Keys were fine. I thinks it because the HASH on ISAKMP cant be turned off (you can only choose between MD5 or SHA) this and because of the NAT the packet will fai...

Hi, I got this working (IPSEC DEC) on 12.1.6 without problem. Could not get it to work with L2TP at the same time though.Is NAT being performed anywhere ? If so this will cause problems. You could try using the transform ESP-DES without any MD5-Hash....