There looks to be a problem with the latest version of the iPad authentication using SSH keys on iPad. When you select the key but do not import it everything works as normal. The user ID is the only thing that is prompted and you are logged in to the system.
When you choose to import the key though, the behavior changes and a mandatory password prompt comes up. With this prompt you can not leave it blank and the authentication now starts failing.
We will include the fix in the next release. In the meanwhile you can work around the problem by importing the private key on a connection created with a NoMachine client for desktop, and by uploading it to the iPad though iTunes (download the NoMachine folder with File Sharing, copy inside it the new connection file, upload the folder).