After I type /ctcp <BotNick> chat and I accept it tells me:
DCC Chat session
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Client: X (213.157.162.122)
Time: Fri Sep 06 03:59:38 2002
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Acknowledging chat request...
DCC Chat connection established
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DCC session closed
/ctcp botnick CHAT is actually same as telneting to the bot, thus the telnet hostmak apply. Did you by any chance play with your hostmasks? Or somehow disabled telnet at all? Also, can you log on the bot using telnet client or /dcc chat botnick?
Ignorant and lazy people will save 30 minutes by chosing simple config file. Smart ones will save 3000 minutes of *everyone's* time by opting for complete config file.