If you’re using multiple oracle homes (multiple versions of the oracle client software), you might want to check that the one used by SQL*Plus (the one it finds first in the path) is the same as the one used by SQL Navigator - you can find the latter at the top of the login dialog.
What client and database version(s) are we talking about anyway?
There are some combinations that are not supported by Oracle - and most of those just do not work!
Could your provide us with a screenshot as I attached? You can get the Oracle Home Editor dialog by pressing the button labeled "..." to the right of the "Oracle Home/Client" field in the login dialog. It will focus on the selected client.