WRT1200AC Password setting doesnt work with 21.02rc4

I installed this image from downloads.openwrt.org for my router "openwrt-21.02.0-rc4-mvebu-cortexa9-linksys_wrt1200ac-squashfs-sysupgrade.bin"
as per instruction I have set not to keep setting and force flash.
it correctly installed and booted up.
I try the luci and it is on port 443 and it loads after accepting the non-issued cert.
then it says no password set and that I should set a password after login.

now my issue is that if I set a password from luci it says failed to set the password.
and if I try to set a password from an ssh it says password changed (after a long 4sec delay) but I can not longer ssh to it with that password or empty password and luci wont accept the password set in ssh either.
it is as if I have a password that is not the password I have set.

had to user dual partition , (a god send for stuff like this happening) and test from my last openwrt installation (19v) and this times tried a custom image that I create for my device (removing ipv6-dhcp and so on) and the same issue is there.

if I add my public key from my laptop to ssh in luci I can ssh because it doesnt ask for passwd but I think the passwd has an issue with this version of openwrt.

if I delete the root password with "passwd -d root" I can ssh again without/with public key and luci works too with no password.

this is related too?

maybe the /etc/passwd has issues?

I think something fixed this because the latest rom I created from repo of rc4 doesnt have this issue.
but also luci password set prompt is not shows with a link so maybe luci option was removed until that was fixed?