Can't connect to freeSSHd Server with Open Terminal

Environment:
Client PC: Windows XP Pro SP2
Server PC: Windows XP Pro SP2

Software:
Client PC: WinSCP v4.1.6 Build (412)
Server PC: freeSSHd v1.2.1

From the WinSCP windows-type file explorer I select Open Terminal icon and I get a dialog box with the following messages:

Searching for host...
Connecting to host...
Authenticating...
Using username "[username]"
Authenticating with pre-entered password
Authenticated
Starting the session

After about 15 seconds I get a dialog box that says "Host has not answered for more than 15 seconds. Still waiting [blah, blah, blah...] Warning ..." So I wait for several minutes and no response.

My question is 1; should a console be available in this environment? and 2; if so, where else could I look for possible resolution to this problem?

Thanks in advance,
ken

I can just guess, but I would guess that it can hardly work. WinSCP needs an unix-like shell for the Open terminal feature. I doubt freeSSHd provides one. Use Open in PuTTY function instead.