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It looks like the logged in user does not see any of the blocks or content generated by XOOPS. Only the header and footer are present.
It can not be cured by checking all the group permissions for the modules in admin?
It might be, that there is a block, which is only showed to the registered users, that makes a problem. try to disable them in admin by setting view to false.
Strange is that after updating the password it works again, altough the user can login.
It might be that there is something wrong with the updated user or profile data.
Can the problem be fixed, if you do not update the password, but update another field in the user profile (as setting eg the ICQ)?