ORA-12520 TNS:Listener count not find available handler for requested type of server

Hi List,

we have an application that's vendor installed to run on the default 1521 port. It needs to accept both "dedicated" and "shared" connection depends on if there's a line (server=dedicated) in tnsnames.ora . After we changed the port to a non-default port, it only accepts "shared" connection (no (server=dedicated) in tnsnames.ora thus defaulting to "shared" connection) and gives the ORA-12520 error when trying to connection as "dedicated" (with (server=dedicated) in tnsnames.ora). I've tried solution provided by http://www.shutdownabort.com/errors/ORA-12520.php, but after I used the local_listener parameter, all connections become "dedicated" even without (server=dedicated) in tnsnames.ora

I googled around and couldn't find any light, I'd greatly appreciate if anybody can point me to a right direction!

Here are the configurations:

OS: Windows 2003
Oracle: 10.1.0.5

init.ora has:
*.dispatchers=(address=(protocol=tcp)(port=nnnnn)(dispatchers=7))

listener.ora
LISTENER =
  (ADDRESS_LIST =

        (ADDRESS =


          (PROTOCOL = IPC)

          (KEY = xxx.world)

        )
        (ADDRESS =


          (COMMUNITY = TCP.world)

          (PROTOCOL = TCP)

          (host = hostname)

          (PORT=nnnnn)

        )

      (SID_NAME = xxx )
      (GLOBAL_DBNAME = xxx )
      (ORACLE_HOME = D:\oracle\ora10g)

tnsnames.ora
xxx.world =
  (DESCRIPTION =
    (ADDRESS_LIST =

        (ADDRESS =


          (COMMUNITY = TCP.world)

          (PROTOCOL = TCP)

          (Host = hostname)

          (PORT = nnnnn)

        )

       (SERVER=DEDICATED)
        (SERVICE_NAME = xxx)

sqlnet.ora
TRACE_LEVEL_CLIENT = OFF
#sqlnet.authentication_services = (NTS)
names.directory_path = (TNSNAMES, EZCONNECT, HOSTNAME) names.default_domain = world
name.default_zone = world
automatic_ipc = off
SQLNET.EXPIRE_TIME = 3
ora_encrypt_login=true

--
http://www.freelists.org/webpage/oracle-l