I was thinking about doing that because the disk is MFM but it is a bit of a pain to have to set up to do that so I will wait before tying something else.  For now the drive works completely fine as long a I don't need to format it.  If it should become unreadable, it will probably corrupt where the password is stored so I could format it anyway  

I believe the password is stored on the drive itself because various "drawers" can be password protected and there is an overall system password to recover lost drawer passwords and to back up the whole drive.  There is a default password in the documentation that I don't have at the moment.  I did buy this recently so I'll see if it's listed in the manual when it arrives:  http://www.ebay.ca/itm/161114811958

This manual is for my original 10MB HyperDrive with the same original logos on the front and back of the Mac 512k. This latest example has the new "HyperDrive" logo on the front and back but doesn't say "HyperDrive 20" because it's only 10mb.  The 10mb mechanisms are almost the same between the two examples so this manual should be relevant to to this newer model too.  I'm crossing my fingers that a default system password is listed.

I already tried to snoop around the software in a hex editor to see if one was there but there didn't seem to be.  I did find a chilling message while snooping.  It said within the code, "Remember, you are a guest in someone elses house"   I guess the developers don't want you to mess around while loking