It seems that there is conflicting information about the proper value for "External User Management" when using an ldap back-end.

The support page http://confluence.atlassian.com/display/DOC/Activating+External+User+Management states
"If your user management is being done with LDAP, you must not turn on external user management"
ie, externalusermanagement=off

while the help tips along the right side of the Confluence->Administration->General page states
"Enable this option if you are delegating your user management to JIRA, LDAP or any other user management system."
ie, externalusermanagement=on

The documentation inside confluence should be less general about when to use external management, maybe say "You may be instructed to turn external managment on in these cases"