SMTP Outgoing Mail Server does not use password so I can not send mail..

Use an alternate SMTP server, for example Gmail. You can still have the account receive as normal, just specify the other SMTP server rather than the one from your email provider.

Set Gmail to forward all mail to your normal account. So while the person might reply to the wrong address, it will get forwarded to you.

Most email progams will use the "reply to" address, but some "badly written" programs will just reply to the "sent from" address. And worse, some lazy users...er...inattentive users... 😉 don't check where they're replying to and will just add whatever email address to their addressbook. (I get CCd mail from one of the department managers every time she intends to CC the lawyer. 😟 ) So setting forwarding in Gmail will not only compensate for the badly written program, it will also compensate for those inattentive users as well. 🙂

"Properly written" programs should show the correct address, and not the gmail address that the message was sent through. But your mail provider has an unusual config as most providers just use password authentication. Or if there is no password, then it's "network authentication" meaning you're on their network when you send the message. (e.g.: RoadRunner, AT&T Mobility.) Really, if your provider just used password authentication like the rest of the industry, this would be a non-issue.

Yeah, I don't know why the difference. Interestingly for me, the iOS version in iOS4.2 is "better" than the OSX version of Mail because now I can have more than one Exchange account.

I am sympathetic with your need to separate your lives. I have a client that accidentally got one of my alternate email addresses and cannot/will not update his address book with the "correct" address, despite my requesting several times over the course of a year. In any case, I don't think there is any way around this other than completely changing your email address. (If not a second Gmail, then Yahoo, Hotmail or other email provider.)

The only time I've ever seen a "no password" SMTP server was as I previously said, it used a "network authentication" method. Many, many moons ago, SMTP servers often didn't have password authentication so would often be used for spam relaying. Before mobile users, "network authentication" by ISPs was fine since they could figure out which user was spamming since they could trace the IP addr, MAC addr, etc back through the physical link to the user. But with mobile users who change networks constantly, the general trend was to password authentication, even for wired ISPs since their users would want to have access to send mail while away from home. (e.g.: you're a RoadRunner customer, but want to send mail while using your laptop on vacation in Italy.) This "prior authenticated download" I've never heard of anyone else doing.

Some of my customers are very (how can I put this politely) 'particular' about conversation threads etc so this workaround would break that 😟

Additional info: this thread|http://discussions.apple.com/thread.jspa?threadID=2717730&tstart=0] on using the "From" field when sending an email may work for you. You'd have to consciously confirm which email address is in the "From" field each time you send, and thus easy to forget, so it still might be the real solution. But it may be worth investigating if you can't get anywhere with your ISP.

Have you checked with your provider? Some have special settings for mobile devices. I found that my ISP (Charter) had a special mobile SMTP server that does allow/require password authentication.

Thanks for posting your solution!