I have been using an iptouch for a long time. Now suddenly I can't delete messages from the inbox. Keep getting an error message. I have tried changing the Trash location in the Settings and also deleting the mail account and re-setting my POP mail (Yahoo mail).
I think you already did this, but searching I found a guy that had the same problem and here is what he did:
1. Opened settings
2. Clicked on mail, contacts, calenders
3. Clicked on Yahoo
4. Clicked on advanced
5. Clicked on Deleted Mailbox
6. Click the "trash" button under "on my iphone" even though its already checked.
Searching the boards I found another solution that seems to work, at least for now: changed the Fetch settings from Manually to Hourly. I don't understand but it works.
I have my email set up as an IMAP account and was getting the same "unable to move..." message. I suspected the problem for me had to do something with the trash bin on the phone and the trash bin on the server not communicating properly. I tried this and it worked for me, although from other posts, I see it doesn't work for everyone:
1. Go to "Settings"
2. Select "Mail, Contacts, Calendars"
3. Select the mail account in question
4. Select "Account Info"
4. Select "Advanced"
5. Select "Deleted Mailbox"
6. Under "On My Server", Click the "Trash" folder (or whatever your trash folder is called on your server). This should put a check mark beside it.
As far as my 3rd gen. touch goes, when I got to the 'on the server' there was no 'trash' option as you said may happen, so I tried the 'blacklist folder 1' and it seems to have worked!