Does any of us have any belief that anyone at Microsoft is cognizant enough to add a "feature" like this that won't eventually be used to brute force passwords and/or can be used as a denial of service vector? I can't imagine Microsoft thinking this through properly.
I noticed this today when I had a keyboard macro write out my password in Notepad and then got quite surprised by the warning, even if it apparently has been around a few years already.
Doing the same in e.g. Notepad++ does not trigger any warnings though.
This only protects your windows 11 logon password. I have a 100 passwords. I suppose it's nice to get a warning if I type one of them into notepad <sigh>, although to accomplish that windows has to store my password in its memory whereas I'd much prefer my password to be stored solely in my memory.