It all depends on what prompts RME will see when it logs into a device. If it sees a Username: prompt, then you will need to populate either the local username field or the TACACS username field. If RME just sees a Password: prompt, then just put in the correct value in the Telnet password field.
Note: believe it or not, it's better to populate the TACACS username and password fields instead of the local username and password fields as some device types ignore the values in the local fields. Don't worry about using RADIUS instead of TACACS. As I said, RME really only cares about the prompts.