Firewall/NAT

Hello Forum,
I am trying to use m0n0wall to replace the firewall-router function of a PPPoE modem that supports a small public subnet.
Here my setup procedure:
1) configure the modem as PPPoE bridge.
2) configure the m0n0Wall WAN for PPPoE with an MTU suggested by my ISP.
3) configure the m0n0wall OPT port with the gateway address for my public subnet.
4) disable outbound NAT by selecting "Advanced Outbound NAT" and leaving the rule-set empty.
5) create firewall rules to allow outside access to the public subnet.

The only trouble I have encountered is that I now have to manually manipulate the MTU settings on the subnet nodes to get certain connections to work. Especially traffic from hosts behind a FW-NAT router with VPNs.

It seems this problem is related to how the PPPoE segment is being handled. Perhaps something to do with MTU discovery being blocked when NAT is disabled?

Any insights, and suggested solutions, on this would be greatly appreciated.

Thanks Much
-Dave