Ftp does not connect to 1and1 servers.
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I am not aware of any reason why the latest DW cannot connect to 1and1 servers.
Are you certain you defined your site correctly with the proper log-in credentials and root directory? See screenshot. Click the TEST button.
Can you connect with Filezilla or some other dedicated S/FTP client?
If not, maybe there's a problem on their side. Contact your host.
Yes 100%. I even had there technical team look into it.
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Download the free Filezilla FTP client and see if it works from there. If it does, at least you'll be able to upload while troubleshooting continues on DW. If it doesn't it would point to an issue with your credentials, network or server.