I'm stumped. I don't recall ever having to make any changes on the Yahoo server.
Try this. First, if you've added yahoo as a mailbox, go into Settings > Mail and delete the Yahoo entry. Then click out of settings to your home page. I'd suggest you reboot your iPad. Press and hold BOTH the power and home buttons at the SAME time for at least 10 seconds (ignore the red slider) until the Apple Logo appears, then let go of both buttons and your iPad will restart. You won't lose any data or settings.
Then try to add your Yahoo mailbox again. I know this is a stupid question, but you are using your correct email address and password? This time skip the box that asks for your name and just type in your email address and password. You can put anything you want in the Last box. Like your name and Yahoo, or just Yahoo.
If this doesn't help, I hope someone else will chime in as I'm out of suggestions.