Do not use custom logins. They will bypass all of CBs login checks. So if you're using email confirmation, approval, etc.. in CB those checks will be skipped. If you insist on doing this you'll need to turn off CBs URL rewrite and redirect protections in CBs Joomla system plugin, but you'll need to be sure you've completely turned off Joomla's registration page and profile pages otherwise you'll end up with backdoor accesses bypassing CB.

Correct, you need to use CBs login module or you will bypass CB during the login process. This will change in CB 3.x where we'll just hook into Joomla's (might implement this before 3.x) login events and finally deprecate our login module. However if you are not using email confirmation or moderator approval then it is possible to use other login modules, but you'll need to lock down the rest of your install as explained in my previous reply.