samba - Mar 2010 - NTLM V2 authentication problem with samba-3.2.6

Hi,
I'm using samba-3.2.6. 
Got the following error while connecting to a server which supports ntlm v2
only.

NT_STATUS_LOGON_FAILURE

Then I changed /etc/samba/smb.conf to include the following line..

client NTLMv2 auth = yes

Even then I got the same error.

Then recompiled the samba source by making the following change..

< Globals.bClientNTLMv2Auth = False;
------
>Globals.bClientNTLMv2Auth = True;
Then it worked.

My questions...
1) Why it failed even though I've added "client NTLMv2 auth = yes"
to smb.conf
2) What are the side effects of the change Globals.bClientNTLMv2Auth = True. Is
this recommended?

thanks,
-Kishore