NCSA telnet doesn't work with path MTU discovery enabled. This is due to a
bug in NCSA that also stops it working with other modern networking code
such as Solaris.

The following information is courtesy of 
Marek <marekm@i17linuxb.ists.pwr.wroc.pl>

There is a fixed version somewhere on ftp.upe.ac.za (sorry, I don't
remember the exact pathname, and this site is very slow from here).
It may or may not be faster for you to get it from
ftp://ftp.ists.pwr.wroc.pl/pub/msdos/telnet/ncsa_upe/tel23074.zip
(source is in v230704s.zip).  I have tested it with 1.3.79 (with
path mtu discovery enabled - ncsa 2.3.08 didn't work) and it seems
to work.  I don't know if anyone is working on this code - this
version is over a year old.  Too bad - it's faster and often more
stable than these windoze telnets, and runs on almost anything...