If anyone else is having issues connecting to Yahoo Messanger using Adium 1.5.9, upgrading to the nightly build 1.5.10 seems to have fixed this issue.
When using Adium to log into your Yahoo! messanger account, the status remains on 'connecting'. Gtalk/etc, is working fine. As is the default Yahoo! messenger app.
Upgrading to the nightly build version 1.5.10 seems to have solved the issue.