There might be several reasons why eBay credentials do not work:

1) The credential for "Live eBay" site instead of "Sandbox eBay" is used.

2) The credential for developer.ebay.com is used instead of a Sandbox account.

It can be simply detected if Sandbox account login is used or not - all Sandbox account logins started with "TESTUSER_".

Normally, the sandbox account can be created using Sandbox Registration Tool, when you are logged into developer.ebay.com.
(Direct URL - http://developer.ebay.com/DevZone/sandboxuser.asp)