Version: (using KDE KDE 3.5.8) Installed from: SuSE RPMs Free/busy information is not updated when accepting an invitation from within the kmail component of kontact. Korganizer is set up correctly, adding or changing events manually, or manually upload free/busy using the menu entry Schedule->Upload Free/Busy Information works perfectly. Korganizer is set up to store the password. Maybe this bug is related to #153014.
Works for me in KDE 4.3.2. It seems you do no longer take care of 3.5, so I'll close this one.