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There was a 10 dollar shareware app in MacAddict last month that could do that, so a versiontracker search might be useful.:)
 
You can do a rudimentary password protection on a single folder by attaching a folder action that requests the password in a dialog, and if it's not correct, then it closes the window. That can still pose a security risk since they can see what's inside, but they can't access it.

The only other (major :p ) problem is that this doesn't work with column view or list view -- only icon view. So much for that. :p
 
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