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a P2P like network of login servers would pose a greater security risk than running Windows 3.1/95 on the current day Internet without a router. It is a wreckless way to run any service and also is a big reason why some may think a public login server is good.

Look at any common multiplayer game where a home user hosts the game. How many have you entered where they cheated or 'hacked' in some way just for their own amusement? The old EQEMu GuildWars suffered this fate multiple times not due to our passwords, but the security vulnerabilities that were in the EQEMu site.

Just something for thought.