We wouldn't be having this problem if we hadn't been advised on how to sign up with the USPS for the API on this page: signup_usps.php
Here's the specific language that is incorrect:
"The confirmation email you receive from USPS will contain the information required for your shipping calculations.
In the confirmation email, locate and record the Username.
When prompted, enter your username in the appropriate field within the development tool you are using.
NOTE:The email you receive from USPS will include details for testing the shipping rate calculations. When you are ready to go live, USPS requests that you contact them for the details for going live with your website."
That page should mention that we need the ACTIVE credentials. If you follow the WebAssist instructions - you are routed to the USPS site and receive the TESTING credentials which Fail with the PowerStore 3. That should be mentioned in the NOTE section above!
I am still awaiting my active credentials from the USPS so this is still not working for me. My store tests only worked when I turned off shipping.