How do I set up an FTP only account?

The fastest was is to set the account's shell (in /etc/passwd to either /bin/false or /usr/bin/passwd. Make sure that whichever you choose is also present in /etc/shells.

Choosing passwd permits the user to change their password by telnetting to the box. false will cause in.telnetd to dump the connection immediately if the user tries to telnet in.

The user will still be able to connect to pop-3 and imap services still, but if you link their mailbox file in /var/spool/mail to /dev/null, they will never get anything and their mail will always be sent to the bit bucket. Just make sure you are running secure daemons!