I hate following instructions that companies publish... if what Bill posted doesn't work, try this.
It looks like it either wants PLAIN login (i.e. no encryption etc.) or it might require you to use an SSL wrapper. So let's create an account that does this.
1) Type in an Account Name (This can be anything you want)
2) Leave the Mail Service setting as it is and click Next
3) Type in your username in the Username field, if your server requires you to login with an E-Mail (like GMail) than type in your E-Mail address here.
4) Password, type in your password in this field. Click Next.
5) Type in your E-Mail address (possibly again) in the appropriate field
6) Incoming Mail Server: This is the address of your POP3 server (you can adjust the ports later)
7) Outgoing Mail Server: This is the address of your SMTP server (you can adjust the ports later) Click Next
8) Click Advanced
9) In port number field set the port of the POP3 server.
10) This setting might change when we test this account. Try using SSL, you will see the port number change, and you might have to set it again.
11) This time we are smarter :P, check the SSL port first and then enter the port number. Remember that the port numbers which servers use to handle SSL connections are different than the ports they use to handle PLAIN connections. Generally PLAIN connections are handled on ports 110 and 25 and SSL connections are handled on 995 and 465.
12) Test your connection: Send a message to yourself and see if you can recieve it. If you get the same error, disable SSL and adjust the ports accordingly. Try the test again, if you get the same error again, then it's a server sided problem and you will have to call GoDaddy (I'm assuming they are hosting your server for you?) and ask them.
Have you thought about hosting the server yourself? It's so much more practical. You have slightly less bandwidth to play around with, but you have complete control. You can create your own DNS records and set up your own servers. That's what I did, and I couldn't be happier. It's always easier to troubleshoot these kind of things when you have physical access to the server.