It appears as though defining user access in System Preferences -> Shared only applies to AFP sharing, not FTP. This means that if your new user is a "Sharing Only" account, it will not work for FTP. FTP sharing for all standard accounts is active regardless of what access is defined in Sharing as long as the FTP checkbox is checked in "Options..."
Try creating a standard user account. Their home directory will the the one they will have access to, but keep in mind that this will allow them to browse the same parts of your filesystem that they could if they did a GUI login locally. (Since most OS X directories have read permissions allowed for everyone.)