Well, “no more need for tunnels or VPN” is a bit misleading. Just sharing your music collection through an open port without any VPN so that anyone could access it would probably make you quite liable under a bunch of copyright laws 😉
Not sure where your problem regarding the password lies, but have you tried to proxy the share as a daap share instead? When I was using Howl quite some time ago, I had _daap._tcp instead of _rsp._tcp in my config file.