Existing Moodle users -- not smooth transition

Moodle 1.9x, Joomla 1.5, Joomdle .82

Is there something we can do to make this path more user friendly?

1. Add existing Moodle user to Joomla.
2. They get an email with a link and a new password
3. Link brings them to an activation page
4. On my system they have to know to go to home to login
5. Login doesn't occur. Second try brings up "Username and password do not match..." However when I go to Joomla admin it shows that they are logged in! Sometimes another login with make them truly logged in. Then the courses they are enrolled in appear on the Joomla home page.

I am a little confused by your chain of events. Are you suggesting this is your current sequence or desired sequence? I will assume current sequence.

1,2,3 are OK ?
4 Why not put a login module on the activation page or edit your activation page to show a link to login?

5. Not sure about this without seeing in action. That said the first thing that comes to mind is to be careful of logins in the joomla frontend. Many times we use admin ids and user ids in the same browser when dealing with joomla (ie front end and backend). Moodle cannot handle this. Thus somethings there is confusion between joomla and moodle. What I always do is use one browser, say chrome, for front end user ie student and another browser, say firefox, for admin work. This ensures the session stuff doesnt get mixed up.
Also, where is the message "username and password do not match" appear? which screen? joomla or moodle? Which login are you using in Joomla (standard joomla, login module, cb, jomsocial)? Difference login approaches behave differently and may not work with joomdle.

My point is the number of steps we subject the user to.

For #5 I toggled the use redirectless SSO in the config as suggested elsewhere. That made one login possib;e.

However, since the upgrade to .82 I am now seeing a MI problem with AEC. I post this on a different topic.

OK now I am not so confused ...

I agree there are a few steps to be performed, though not all by the user. For example step 1 is done by admin and step 5 sounds like a problem, thus leaving 2-4. IMO, step 4 ie redirection should be avoided such that the user should see
1) email with activation link
2) activate and login at the same time

Two steps and I really cannot see it any less than this unless you wish to send them a new password. However, even this would require two steps. 1) email 2) login.