I just did the same thing - The "lower" cassette has two parts - see if you can pull another drawer out below the one you tried - the paper does fit in there... the upper one will just fit envelopes it seems. Stealthy lower drawer!
The set up instructions specify to load the MP-101 paper into the lower cassette. Neither the MP-101 paper nor plain paper seem to fit between the right/left paper guides in this cassette. ??