1. Went into the App Manager and deinstalled Pidgin protocols plugin for Conversations and Contacts.
2. Rebooted phone by pressing power button, selecting "Shut off", then holding power button until white light came on.
3. Started web, went to the URL you described, downloaded and installed Pidgin protocols plugin for Conversations and Contacts 0.7.
Behaviour is still the same. I added in the ICQ account and immediately it says "Not signed in". I then went into the advanced settings. "Use ClientLogin" and SSL were already unchecked. The settings were the same as before.
I'm sorry to say this did not resolve my issue. Thanks for the advice.
@OP: It isn't just you. I also had ICQ go belly up for no real apparent reason. Things have been a bit flakey for with this protocol on the N900 to be honest for some time. I did howevver find that installing Pidgin itself and then using that solved the issue in terms of being able to chat. It's not as nice as having the built in client always on but it works well. Might be a work around for now?
I know this post is old, but if anyone still uses icq like me. I checked the login url from pidgin and it was slogin.icq.com not login.icq.com I put the missing s in front off the url and now it works like a charm!