IOS 5 MS Exchange Problem on iPhone 4

I have updated my iPhone 4 with the new iOS 5. The only issue I am having is that my email (a gmail account) that I use with Microsoft Exchange keeps giving me a "Password Incorrect: Enter the password for the Exchange account." error message. I deleted the mail account, added it again, and it verifies with all check marks just fine. However, the moment you go to check your email, this message pops up. I don't want to use it as POP due to using gmail calendar instead of my mac one. Does anyone know how to solve this? My password is correct, is entered case-sensitive, and etc. I searched the forums, but the other person solved theirs with just re-adding it which isn't working for me.
Thank you in advance for your consideration and support.

Here is the Problem:
IOS5 + iCloud + Microsoft Exchange = Huge Problem.
The problem seems to be caused by the contacts, so what you basically need to do is remove iCloud from your IOS5, Reset Network Settings and then your MS Exchange will work. If you activate iCloud again you will once again end up with MS Exchange not working and eating your battery to pieces.
No idea how to log the problem with Apple so hopefully one of you guys can confirm this and logg the error with them.
iCloud reactivation will work if you NOT Sync Contacts though.
Best of Luck to you all.

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