Thank you for your response!
I have recently re-installed W7 so there are currently no applications which might interfere with Java.
As far as the router goes... well I never had issues with any connectivity with other games except for MC but after I've port-forwarded it worked.
However I tried it with Salem as well, now I am not guru with this stuff but it still doesn't work, here is a pic because I have a feeling I did something wrong ._.

Thank you for your time and help!
EDIT: Just in case here is the pic of the message I'm getting:
ALSO: It doesn't matter what I type in the login/password, it shows the same message.
Additional stuff: