Then at least put the password field back on the main member data entry screen so that when an admin is adding a member manually, he/she can add all the email, name, address, etc. information as well as set the password in one fell swoop without having to first save the member info, then remember to click over to the Contact tab, then click to edit the Login details to edit the password. When you're adding 50+ members at a time manually, it's just too error prone to remember to do all these steps for each one. Plus it make the process that much longer. With one or two records it's not a big deal. But in the course of adding 50-100 records, it adds up.
Also adding a checkbox next to the password field to force the user to change password upon login would be good. Sort of a one-time-use password feature so that people cannot continue to use changeme as their password.
Or, change the "Forgot password" link to read "Set password" or similar so that it is a little more intuitive for new members. When I've forgotten to set a password for a new member that I added manually, the new members are usually very confused about how to login. For whatever reason, they don't think to use the Forgot Password link because, in their minds, they haven't forgotten anything -- they've never had a password to begin with. Of course, you'd have to change the wording of the email that gets sent to them too to be a little less "A request was made to recover a lost password at this email address" and more like "A request was made to set/reset a password for this email address".
Just some ideas. The way it is now is just a pain for admins and confusing to members. (IMHO) :-)
Kim