problem with non root user and ctrl-o

[eriks swh-t lv]

Hi,
I'm having problem with doing ctrl-o in mc as a normal user (non root). For root it works great, but for non root it thinks that it is dumb terminal (I tried to set TERM=Eterm|xterm|linux).
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I'm using Slackware (some post 9 version), kernel 2.4.22.
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GNU Midnight Commander 4.6.0
Virtual File System: tarfs, extfs, cpiofs, ftpfs, fish, undelfs
With builtin Editor
Using included S-Lang library with terminfo database
With subshell support as default
With support for background operations
With mouse support on xterm and Linux console
With internationalization support
With multiple codepages support
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I assume it has something to do with pty's.
Kernel is compiled with "Unix98 PTY Support" and "/dev/pts File System".
devpts is mounted: "devpts on /dev/pts type devpts (rw,gid=5,mode=620)".
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I found that I might have to set cons.saver to be set uid, but it did not help.
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Any help is apprecated.
Pls let me know if I can provide more information.
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Thx,
Eriks