I'll weigh in here since I've actually seen the behavior at this sight.

This was my first thought as well.  So, I deleted the .pwd file, loaded
dsmc again, entered the password, did an incremental, exited dsmc, ensured
there was a new .pwd file, there was, and loaded dsmc again and was
prompted for a password again!

Is this a rights problem, an NLM problem or what?  ANY IDEAS ARE GREATLY
APPRECIATED!  We've got a similar system setting adjacent to this one that
does not exhibit this behavior.  I would have said "identical" but
obviously it isn't in some subtle way...

Thanks,

Kelly J. Lipp
Storage Solutions Specialists, Inc.
www.storsol.com
lipp AT storsol DOT com
(719)531-5926