I had a problem with kobo touch setup, when doing it with the USB lead: the PC kobo app refused to take my kobo user id and password. The solution (because I have WiFi) was (from memory):
(a) leave the two fields blank and click Continue. This causes error messages to appear.
(b) click the cross at the top right-hand corner to close the user id/password dialogue. You'll get another prompt along the lines of "do you really want to exit setup?"
(c) click "Exit setup"
(d) Eject the kobo from the PC.
The kobo then goes through an update, restart, update sequence, and finally (after several minutes) prompts you to connect to your WiFi.
(e) Click the button to complete setup over WiFi
(f) Click your WiFi connection
(g) Enter your WiFi password
You'll then be prompted for your Kobo user id and password. The kobo touch works quite slowly, so the "show password" box is rather useful, because often letters get missed. My password contains letters, digits and punctuation characters, so that is not an issue.
You should be home and dry now.
(a) leave the two fields blank and click Continue. This causes error messages to appear.
(b) click the cross at the top right-hand corner to close the user id/password dialogue. You'll get another prompt along the lines of "do you really want to exit setup?"
(c) click "Exit setup"
(d) Eject the kobo from the PC.
The kobo then goes through an update, restart, update sequence, and finally (after several minutes) prompts you to connect to your WiFi.
(e) Click the button to complete setup over WiFi
(f) Click your WiFi connection
(g) Enter your WiFi password
You'll then be prompted for your Kobo user id and password. The kobo touch works quite slowly, so the "show password" box is rather useful, because often letters get missed. My password contains letters, digits and punctuation characters, so that is not an issue.
You should be home and dry now.