Password Security From Apple: "The posting of Password Security 1.0.6 addresses a problem with the Mac OS 8.1 installer where the control panel will not get installed on a PowerBook 2400 or 3400 unless it already exists. Since Mac OS 8.0 didn't install the control panel, it is unlikely that the 8.1 installer will install it. You should download this software if you wish to use Password Security with Mac OS 8.0 or 8.1 and you have a PowerBook 2400 or 3400."
Apple also notes: "When using a Mac OS Extended formatted drive as your start up disk, the Password Security control panel will not function properly. Do not use the Password Security control panel if you plan to password protect and then start up from a Mac OS Extended formatted volume."