Oh, wait: you "can still ssh into the system as any valid user, but xrdp (from windows mstsc) only works for the oritional userid", so that isn't the issue. Forget I said anything. :-))
Assuming that your users are not local to the desktop system running Xrdp, it sounds like that system is currently unable to authenticate them via the network. This can be tested by logging into the systen via SSH and then running "getent passwd". If you don't see any of the users you would normally expect, then you might want to start by troubleshooting the connection to your authentication server, be it LDAP, Kerberos or whatever.