Since Fedora Core 5, pppoe-server that comes with rp-pppoe RPM package has always been broken. Someone actually filed a bug report, but unfortunately there was no response. Apparently the problem is caused by ppp conflicting with syslogd. If you stop syslogd and klogd, then pppoe-server will run properly. Fedora Core 4 does not have this problem though.
I’m not sure if the newly released Fedora 7 has got this issue sorted out. I’m guessing that they haven’t. If you have installed Fedora 7 and found out that the issue has been fixed, please let me know ASAP. Thanks! 🙂
Update (Jul 03, 2007): Problem confirmed in Fedora 7.
Update (Mar 14, 2008): Problem fixed as stated on bugzilla ticket.