Keep these items in mind as you consider changing your password level.
Password level 1 allows a system, which does not have a need to communicate with the Windows® 95/98/ME or AS/400® Client Support for Windows Network Neighborhood (iSeries™ NetServer™) product, to have the iSeries NetServer passwords eliminated from the system. Eliminating unnecessary encrypted passwords from the system increases the overall security of the system.
At QPWDLVL 1, all current, pre-V5R1 password substitution and password authentication mechanisms will continue to work. There is very little potential for breakage except for functions and services that require the iSeries NetServer password.