ORA-16629: database reports a different protection level from the protection mode
Cause : The actual protection level supported by the standby database was different from the protection mode set on the primary database. This was likely caused by redo transport problems.
Action - How to fix it : DBA Scripts :: www.high-oracle.com/scripts
Check the database alert logs and Data Guard broker logs for more details. Check the redo transport status. Make sure at least one standby redo transport is supporting the protection mode and that the network to the standby database is working.
Well, the reason for above error is that i have taken the above script from a 11g database and running it on 10g database. 11g has bring some changes in password management. Below code is executed on 11g and user created successfully, which is expected result.