After doing a fresh install of Movable Type 3.2, I found that del.icio.us was no longer posting the daily linklog. Even after I updated the XML-RPC URL and username and password, the daily blog posting page would meet this error from Movable Type:

metaWeblog.newPost fault was: Invalid login

It turns out that you’re supposed to set your MT API password separately from your regular username and password. To do this, go to Main Menu > Authors > Yourself (where “Yourself” is you, of course, and there shouldn’t be anyone else if you’re on the free single-author setup), and set your API password in the last field. It doesn’t need to be the same as your MT password, but you’ll need to make sure to update the password for external services which post using the API, such as Flickr and del.icio.us. (And use the “Reveal” link to make sure your password isn’t in ALLCAPS, which mine was for the first day, to much puzzlement and head-scratching.)