Hi,
Just a quick reply here (I'm about to leave for 11 days on vacation)...
The plugin does not interfere at all with Osclass user registration, so you should not be experiencing any issues from this plugin with regards to users registering/logging-in to Osclass.
However, the user will NOT be able to login directly to SMF. The only way a user can be logged into SMF is by logging into Osclass. That is because the users password only works with Osclass, not SMF. There currently is not a way to allow direct login to SMF for users created by this plugin.
I'm not sure if that helps at all, but I really can't dig any further right now... not until I return.