Odds are the other side is including the sftp-server subsystem in their openssh. Every time I've seen this issue it's been fixed by the tweak in the link you found. It seems like this issue is caused by the SSH/sftp server sending some extra control characters back to jEdit that chokes it. I was able to tail -f some logs on my server when having this issue and could see successful auth. but session wouldn't establish. There was this other SFTP app I used in Windows what would ding and display an empty message box twice. But fixing the server side as describe got rid of the sftp issues for jEdit and the other sftp app. HTH