InfoPath Dev

Is it possible to pass across Windows login credentials automatically so users are not prompted for a login when accessing forms?

You should be able to cache credentials although vista clients have some issue with this.

I would try accessing other content on the site and see if you can save you password for access or check your specific permissions on the library.

There is no other content where they would need to login but even if there were caching would still create problems as our password policy mandates that all passwords change once a month so this would inevitably lead to failed logins. WikiMedia and  bulletin board software such as YAF (Yet Another Forum) are capable of autologins on Windows networks so I'm a little disappointed that one of Microsoft's own products doesn't

So does the form or the library have different permisisons then other content on the site?

InfoPath / IE is going to pass the current windows user credentials. So a password update should not be a big deal as long as the information via IE is getting passed correctly.

I have seen in 2003 where people had to save their info once and then it would pass properly. I have not had a problem with 2007 other than some Vista WebDav issues.