SSH Error

[KnightCrawler]

When I try to tunnel my traffic from my one system to another I get an ssh error and the connection breaks. But if I simply connect to my ssh server the connection works fine.

Error:

root@bt:~# ssh -v -g -N -D 31154 xp@192.168.1.5
OpenSSH_6.1p1, OpenSSL 0.9.8k 25 Mar 2009
debug1: Reading configuration data /usr/local/etc/ssh_config
debug1: Connecting to 192.168.1.5 [192.168.1.5] port 22.
debug1: Connection established.
debug1: permanently_set_uid: 0/0
debug1: identity file /root/.ssh/id_rsa type -1
debug1: identity file /root/.ssh/id_rsa-cert type -1
debug1: identity file /root/.ssh/id_dsa type -1
debug1: identity file /root/.ssh/id_dsa-cert type -1
debug1: identity file /root/.ssh/id_ecdsa type -1
debug1: identity file /root/.ssh/id_ecdsa-cert type -1
debug1: Remote protocol version 2.0, remote software version WeOnlyDo 2.1.3
debug1: no match: WeOnlyDo 2.1.3
debug1: Enabling compatibility mode for protocol 2.0
debug1: Local version string SSH-2.0-OpenSSH_6.1
debug1: SSH2_MSG_KEXINIT sent
debug1: SSH2_MSG_KEXINIT received
debug1: kex: server->client aes128-cbc hmac-md5 none
debug1: kex: client->server aes128-cbc hmac-md5 none
debug1: sending SSH2_MSG_KEXDH_INIT
debug1: expecting SSH2_MSG_KEXDH_REPLY
debug1: Server host key: RSA 46:60:5d:61:2e:c2:22:1a:ab:f6:d6:e8:ec:8d:3e:41
The authenticity of host '192.168.1.5 (192.168.1.5)' can't be established.
RSA key fingerprint is 46:60:5d:61:2e:c2:22:1a:ab:f6:d6:e8:ec:8d:3e:41.
Are you sure you want to continue connecting (yes/no)? yes
Warning: Permanently added '192.168.1.5' (RSA) to the list of known hosts.
debug1: ssh_rsa_verify: signature correct
debug1: SSH2_MSG_NEWKEYS sent
debug1: expecting SSH2_MSG_NEWKEYS
debug1: SSH2_MSG_NEWKEYS received
debug1: Roaming not allowed by server
debug1: SSH2_MSG_SERVICE_REQUEST sent
debug1: SSH2_MSG_SERVICE_ACCEPT received
debug1: Authentications that can continue: password,publickey
debug1: Trying private key: /root/.ssh/id_rsa
debug1: Trying private key: /root/.ssh/id_dsa
debug1: Trying private key: /root/.ssh/id_ecdsa
debug1: Next authentication method: password
xp@192.168.1.5's password: 
debug1: Authentication succeeded (password).
Authenticated to 192.168.1.5 ([192.168.1.5]:22).
debug1: Local connections to *:31154 forwarded to remote address socks:0
debug1: Local forwarding listening on 0.0.0.0 port 31154.
debug1: channel 0: new [port listener]
debug1: Local forwarding listening on :: port 31154.
debug1: channel 1: new [port listener]
debug1: Entering interactive session.
debug1: Connection to port 31154 forwarding to socks port 0 requested.
debug1: channel 2: new [dynamic-tcpip]
buffer_get_ret: trying to get more bytes 4 than in buffer 0
buffer_get_string_ret: cannot extract length
buffer_get_string: buffer error
root@bt:~#

On googling I found people saying that deleting the "known_hosts" file in .ssh directory can fix it (because of corruption due to newline character). But it also didn't work.
I tried to do the same in BT5, BT5r2, BT5r3 and I m facing the same problem in all of them.
Anyone else facing the same problem?

[Gitsnik]

My experience says it's the ~/.ssh/authorized_keys file, not known_hosts. Try moving it elsewhere or deleting it entirely.

[KnightCrawler]

Thank you. But there is no such file in my .ssh directory.

[KnightCrawler]

SOLVED
The problem was with the SSH server. I was using freesshd. I replaced it with winsshd and it worked perfectly.

Thank you.