getting message: Bad Behavior is not installed correctly. in Bad Behaviour LOG

When you unzip the bad-behavior-2.0.x.zip archive it creates a directory named "Bad-Behavior" that contains a few php files and a directory named "bad-behavior". Move the contents of the "Bad-Behavior" directory (the php files and the directory) out of that folder and place them in your "..modules/badbehavior" directory.

This fixed things for me. The readme is a little unclear on the necessary directory structure. Good luck!