1)It is not showing any error in Application message tab. Status is complete. It is identifying all details properly.Strange!! Check other reports like wire message and error message and see whether you get anything there.
2)Any idea what could have went wrong on opting for 'Default' while configuring B2B adapter.No idea. Enable logging for b2b in trace mode and mail across the log to my id(in my profile)/post it here. For changing logging level of b2b -