Solved 127.0.0.1 lost connection on player connects after upgrade to 1.7.2

The server was running lilypad allinone standalone fine. I updated to the recommended 1.7.2 allinone(83) and bukkit connect (40) and I get this at the server console when anyone connects local network or external:
21:32:27 [INFO] /127.0.0.1:52135 lost connection

It has no problem connecting to the cloud like before and no errors till someone connects.
client will see internal exception: io.netty.handler.timeout.ReadTimeoutException after a bit

configs:

Code (text):

{
  "proxy": {
    "bind": {
      "address": "0.0.0.0",
      "port": 25565
    },
    "outbound": {
      "address": "0.0.0.0"
    },
    "servers": [
      {
        "domain": "*",
        "server": "spawn"
      }
    ],
    "motd": "A Minecraft Server",
    "playerMaximum": 200,
    "authenticate": true,
    "throttle": 2500,
    "tabEnabled": true,
    "localeFull": "You seem to be already logged in",
    "localeOffline": "Offline/Maintenance",
    "localeLoggedIn": "You have logged in from another location",
    "localeLostConn": "Lost connection... Please try to reconnect",
    "localeShutdown": "The server is being restarted. Please try to reconnect"
  },
  "queryTcp": {
    "bind": {
      "address": "0.0.0.0",
      "port": 5555
    }
  },
  "queryUdp": {
    "bind": {
      "address": "0.0.0.0",
      "port": 25565
    }
  },
  "connect": {
    "bind": {
      "address": "0.0.0.0",
      "port": 5091
    },
    "logins": [
      {
        "username": "spawn",
        "password": "yomomma"
      },
      {
        "username": "smp",
        "password": "yomomma"
      },
      {
        "username": "creative",
        "password": "yomomma"
      },
      {
        "username": "special",
        "password": "yomomma"
      },
      {
        "username": "skyblock",
        "password": "yomomma"
      }
    ]
  }
}

spawn config:

Code (text):

settings:
  address: 127.0.0.1
  port: 5091
  credentials:
    username: spawn
    password: yomomma
 

I've also tried allinone 84-93 and bukkit connect 40-42 and same issue.

If I change to 0.0.0.0 like this:

Code (text):

settings:
  address: 0.0.0.0
  port: 5091
  credentials:
    username: spawn
    password: yomomma
 

then the console will return this on a player connect:
22:04:37 [INFO] /192.168.1.117:52176 lost connection (server local ip)

I go back to allinone 78 back with bukkit-connect 36 (I think thats the version) and it goes back to working fine under 1.6.4.

Ideas?

@wreckage What version of CraftBukkit or Spigot are you running?

I've tried with craftbukkit r1.0 build 2912 and r1.1 build 2917. Same results with both

Haha, easy fix man. Check out your title, it says 1.7.2, and the craft bucket version you are running is a 1.6.4 version http://prntscr.com/20vf9r. I'm not that familiar with Craft Bucket or the community over there, but from what I am aware of they don't have a 1.7 version out yet. If you want to update to 1.7, the only way to do it is through Spigot that I am aware of through this date in time (Unless your going vanilla). The link for the recent downloads of the build for spigot that work with 1.7 are over here http://ci.md-5.net/job/Spigot-1.7/ . This is a protocol version so it doesn't suport any of the features of 1.7, but its the only way to currently update.

^^ From the Spigot Websight.

I have heard nothing bad about it though from lots of my friends who have all update, I would just keep a backup of your server on your computer, just incase.

To spigot I go then. Not sure what I was thinking. Just started updating and since I had got no errors on server startup...

Its totally cool man, everyone makes those little mistakes every once in awhile, especially ones that like yours where it might not cross your mind. Glad I could be of help