Removing the email validation requirement
That setting is part of core Drupal. 

Go to admin/user/settings, and under 'User Registration Settings' set 'Public registrations' to 'Visitors can create accounts and no administrator approval is required'. Also untick the 'Require e-mail verification when a visitor creates an account' checkbox and you should be good to go.



Once you've done that it might be worth re-checking your Login Toboggan settings just to make sure there's nothing interfering with your new settings.