ssl issue with dovecot

I have an, apparently frequently occurring but unsolved, issue with gmail when retrieving mail from external pop mail boxes via gmail. Looking at the error details it says:

server responded: 'authentication failed'.

This mail server is my own server and when I connect from terminal with:

~$ telnet mail.mydomain.com:995

I get the following:

Trying xx.xx.xxx.xx...
Connected to mail.mydomain.com.
Escape character is '^]'.

and then when trying to login:

user myuser
Connection closed by foreign host.

And in my mail log:

Mar 26 18:22:42 www dovecot: auth: Debug: Loading modules from directory: /usr/lib/dovecot/modules/auth
Mar 26 18:22:42 www dovecot: auth: Debug: Module loaded: /usr/lib/dovecot/modules/auth/libdriver_mysql.so
Mar 26 18:22:42 www dovecot: auth: Debug: auth client connected (pid=6554)
Mar 26 18:23:20 www dovecot: pop3-login: Disconnected (no auth attempts): rip=xx.xx.xxx.xx, lip=xx.xx.xxx.xx, TLS handshaking: SSL_accept() failed: error:140760FC:SSL
routines:SSL23_GET_CLIENT_HELLO:unknown protocol

when testing ssl with:

~$ openssl s_client -connect mail.mydomain.com:995

I can connect, but with this line (I purchased a godaddy certificate):

Verify return code: 19 (self signed certificate in certificate chain)

What could I be doing wrong? Here are my config files:

# 2.0.13: /etc/dovecot/dovecot.conf
# OS: Linux 3.0.0-13-server x86_64 Ubuntu 11.10 ext4
log_timestamp = "%Y-%m-%d %H:%M:%S "
mail_location = maildir:/home/vmail/%d/%n/Maildir
managesieve_notify_capability = mailto
managesieve_sieve_capability = fileinto reject envelope encoded-character vacation subaddress comparator-i;ascii-numeric relational regex imap4flags copy include variables body enotify environment mailbox date
namespace {
  inbox = yes
  location = 
  prefix = INBOX.
  separator = .
  type = private
}
passdb {
  args = /etc/dovecot/dovecot-sql.conf
  driver = sql
}
protocols = imap pop3
service auth {
  unix_listener /var/spool/postfix/private/auth {
    group = postfix
    mode = 0660
    user = postfix
  }
  unix_listener auth-userdb {
    group = vmail
    mode = 0600
    user = vmail
  }
  unix_listener auth-master {
    mode = 0600
    user = vmail
  }
  user = root
}
ssl = required
ssl_cert = </etc/ssl/certs/mail.mydomain.com_combined.crt
ssl_key = </etc/ssl/private/mail.mydomain.key
userdb {
  args = uid=5000 gid=5000 home=/home/vmail/%d/%n allow_all_users=yes
  driver = static
}
protocol lda {
  auth_socket_path = /var/run/dovecot/auth-master
  log_path = /home/vmail/dovecot-deliver.log
  mail_plugins = sieve
  postmaster_address = [email protected]
}
protocol pop3 {
  pop3_uidl_format = %08Xu%08Xv
}
disable_plaintext_auth = no

auth_verbose = yes
auth_debug = yes

Postfix:

# See /usr/share/postfix/main.cf.dist for a commented, more complete version

# Debian specific:  Specifying a file name will cause the first
# line of that file to be used as the name.  The Debian default
# is /etc/mailname.
#myorigin = /etc/mailname

smtpd_banner = $myhostname ESMTP $mail_name (Ubuntu)
biff = no

# appending .domain is the MUA's job.
append_dot_mydomain = no

# Uncomment the next line to generate "delayed mail" warnings
#delay_warning_time = 4h

readme_directory = /usr/share/doc/postfix

# TLS parameters
smtpd_tls_cert_file = /etc/ssl/certs/mail.mydomain.com_combined.crt
smtpd_tls_key_file = /etc/ssl/private/mail.mydomain.com.key
smtpd_tls_security_level = may
smtpd_tls_session_cache_database = btree:${data_directory}/smtpd_scache
smtp_tls_session_cache_database = btree:${data_directory}/smtp_scache

# See /usr/share/doc/postfix/TLS_README.gz in the postfix-doc package for
# information on enabling SSL in the smtp client.

myhostname = mail.mydomain.com
mydomain = mydomain.com
alias_maps = hash:/etc/aliases
alias_database = hash:/etc/aliases
myorigin = /etc/mailname
mydestination = 
relayhost = 
mynetworks = 127.0.0.0/8 [::ffff:127.0.0.0]/104 [::1]/128
mailbox_command = procmail -a "$EXTENSION"
mailbox_size_limit = 0
recipient_delimiter = +
inet_interfaces = all
html_directory = /usr/share/doc/postfix/html
message_size_limit = 30720000
virtual_alias_domains = 
virtual_alias_maps = proxy:mysql:/etc/postfix/mysql-virtual_forwardings.cf, mysql:/etc/postfix/mysql-virtual_email2email.cf
virtual_mailbox_domains = proxy:mysql:/etc/postfix/mysql-virtual_domains.cf
virtual_mailbox_maps = proxy:mysql:/etc/postfix/mysql-virtual_mailboxes.cf
virtual_mailbox_base = /home/vmail
virtual_uid_maps = static:5000
virtual_gid_maps = static:5000
smtpd_sasl_auth_enable = yes
broken_sasl_auth_clients = yes
smtpd_sasl_authenticated_header = yes
# see under Spam smtpd_recipient_restrictions = permit_mynetworks, permit_sasl_authenticated, reject_unauth_destination
proxy_read_maps = $local_recipient_maps $mydestination $virtual_alias_maps $virtual_alias_domains $virtual_mailbox_maps $virtual_mailbox_domains $relay_recipient_maps $relay_domains $canonical_maps $sender_canonical_maps $recipient_canonical_maps $relocated_maps $transport_maps $mynetworks $virtual_mailbox_limit_maps
virtual_transport = dovecot
dovecot_destination_recipient_limit = 1

# Spam
disable_vrfy_command = yes
smtpd_delay_reject = yes
smtpd_helo_required = yes
smtpd_helo_restrictions = permit_mynetworks,
   check_helo_access hash:/etc/postfix/helo_access,
   reject_non_fqdn_hostname,
   reject_invalid_hostname,
   permit
smtpd_recipient_restrictions =
   permit_mynetworks,
   permit_sasl_authenticated,
   reject_unauth_destination,
   reject_invalid_hostname,
   reject_non_fqdn_sender,
   reject_non_fqdn_recipient,
   reject_unknown_sender_domain,
   reject_unknown_recipient_domain,
   reject_non_fqdn_hostname,
   reject_rbl_client sbl.spamhaus.org,
   reject_rbl_client zen.spamhaus.org,
   reject_rbl_client cbl.abuseat.org,
   reject_rbl_client bl.spamcop.net,
   permit
smtpd_error_sleep_time = 1s
smtpd_soft_error_limit = 10
smtpd_hard_error_limit = 20