I guess you are missing my point, if you store a text file with all of your passwords (for copying/pasting) in encrypted form then there is no plain text version stored on the computer (except while loaded in memory)
if it's encrypted then you can't just copy and paste it into the login screen which is what he wants to do.
Man, you really are making this difficult: Create Excel spreadsheet Enter passwords Save spreadsheet Encrypt using NTFS encryption (File->Properties->Encrypt) Result: File is encrypted on hard drive but while you are logged in you can open it and copy/paste the passwords just fine If your laptop is stolen or compromised the file cannot be unencrypted without your Windows password (or a brute force attack). Clear enough?
I use a program called Roboform where all my passwords are stored. The program uses different forms of encryption like AES. You can choose through the degrees of encryption. There is no computer around that can break that encryption. I highly suggest this program.