Not sure if it is entirely relevant, but maybe these could help:
keywords to look/search for are 'PPP _and_ stupid mode'...
I set one up for a friend last year with KOL.
I seem to remember that you needed to use Gnomeppp, The other dialers would not connect.
and yes, go to setup, options and tick the box "ignore terminal string" (stupid mode)
I have an idea their was something else I did but I can't remember at the moment.
Kppp and WVdial couldn't be set to ignore init strings.
David