Users cannot logon after upgrade to 1.6.03 from 1.5.48

[SteveKavBadger]

I have some errors after upgrade and see the listed in text above report before version report complete.
- album/edit/index.php 1.5.40 outdated
- albums/edit/no_FTP-uploads_into_this_folder!.txt may be corrupt or deliberately disabled
- albums/index.php   1.5.40 outdated
- albums/userpics/index.php  1.5.40 outdated
- anycontent.php  1.5.40  outdated
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However, over 60% of user passwords have disappeared during the upgrade.  Recent passwords from the last few months are in place, but older ones are not in place.
I seem to be the only person who can logon.  I have gone in and entered temporary passwords for many users, but they cannot get in with the new temporary passwords.  They are informed they are banned from the site after multiple attempts.