openssh on Windows 7 server, putty displays "refused our key"

Question

I installed openssh as a service with the help of cygwin using this tutorial
I can ssh into localhost from cygwin.
However, when I try to do this from putty, I get a "server refused our key" error.

During the setup process, id_rsa and id_rsa.pub were generated in the .ssh folder.
I took the id_rsa file, imported it into puttygen and generated private.ppk file.
I created a session in putty to use the private key.

When I try to log in, it prompts me for the username. After I enter my username, I get a "refused our key" error, and it attempts to use password authentication.

I would appreciate any help.

EDIT:

In case it helps, here's an output of a successful SSH to localhost from cygwin

$ ssh -v localhost
OpenSSH_6.0p1, OpenSSL 1.0.1c 10 May 2012
debug1: Reading configuration data /etc/ssh_config
debug1: Connecting to localhost [::1] port 22.
debug1: Connection established.
debug1: identity file /home/Pasha/.ssh/id_rsa type 1
debug1: identity file /home/Pasha/.ssh/id_rsa-cert type -1
debug1: identity file /home/Pasha/.ssh/id_dsa type -1
debug1: identity file /home/Pasha/.ssh/id_dsa-cert type -1
debug1: identity file /home/Pasha/.ssh/id_ecdsa type -1
debug1: identity file /home/Pasha/.ssh/id_ecdsa-cert type -1
debug1: Remote protocol version 2.0, remote software version OpenSSH_6.0
debug1: match: OpenSSH_6.0 pat OpenSSH*
debug1: Enabling compatibility mode for protocol 2.0
debug1: Local version string SSH-2.0-OpenSSH_6.0
debug1: SSH2_MSG_KEXINIT sent
debug1: SSH2_MSG_KEXINIT received
debug1: kex: server->client aes128-ctr hmac-md5 none
debug1: kex: client->server aes128-ctr hmac-md5 none
debug1: sending SSH2_MSG_KEX_ECDH_INIT
debug1: expecting SSH2_MSG_KEX_ECDH_REPLY
debug1: Server host key: ECDSA 7a:52:.........
debug1: Host 'localhost' is known and matches the ECDSA host key.
debug1: Found key in /home/Pasha/.ssh/known_hosts:1
debug1: ssh_ecdsa_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: publickey,password,keyboard-interactive
debug1: Next authentication method: publickey
debug1: Offering RSA public key: /home/Pasha/.ssh/id_rsa
debug1: Server accepts key: pkalg ssh-rsa blen 279
debug1: read PEM private key done: type RSA
debug1: Authentication succeeded (publickey).
Authenticated to localhost ([::1]:22).
debug1: channel 0: new [client-session]
debug1: Requesting [e-mail]
debug1: Entering interactive session.
Last login: Tue Jul 17 00:14:52 2012 from ::1

Answer 1

The ssh-user-config program generates an SSH keypair (~/.ssh/id_rsa and ~/.ssh/id_rsa.pub) for the user you are currently logged in as, and if you choose to, adds that to ~/.ssh/authorized_keys, where ~ probably refers to /cygdrive/c/cygwin/home or C:\cygwin\home.

Therefore, you need to log in as the same user you ran ssh-user-config as. (This is neither cyg_server nor sshd, which are special accounts used for the SSH login process.)