We are using WFA 2.1
Ok I was trying with a $id. So it did not work. What worked was a non $ id in this format - DOMAIN\userid
But A few more points.
We tried this format with the $id -
DOMAIN\$userid OR $email@example.com did not work and the error trace log said - authentication failed..not much info.
DOMAIN\'$userid' yielded a more useful error message clearly saying $userid of DOMAIN did not work..so it is very clear that when we included the quotes it took the proper id but did not connect properly.
Thanks all for the help.