explaining the output of 'debug ppp negotiation':
O: send by this device
I: send by ISP (other device)
LCP / PPP negotiation
CONFREQ: a configuration-request
CONFACK: Configure-Acknowledge
CONFREJ: reject! (options in the CONFREQ are not recognized)
CONFNAK: PPP configuration error! (values of CONFREQ are not acceptable)
Look at the Line following the CONFNAK or CONFREJ!
The only place where you can configure PPP stuff is in the dialer interface. Type
show running-config interface dialer N
to view the config.