Why require a password to copy?
 

Presumably the request for a password before copying data is designed to prevent someone illicitly copying your data to another hard drive. If someone had got this far, though, I suppose they could simply use Finder to copy the data anyway. For scheduled copy, I've turned off password protection, because I assume the scheduler has no way to remember a password the way "scheduled tasks" does in Windows.

No. We need to prompt because copying files requires "authentication" -- that is, the ability to access all files on your drive. This is the same password you use when you install a software update.

If you don't want to enter the password, you can "unlock" SD!, which "permanently" authorizes it.