The administration is password protected, not the whole website. And I am the only one who needs access to the administration so there aren't custom sessions.
"If you use .htaccess, any subfolders within the protected folder should require a login also"
What do you mean by 'should require'? It would be a good idea to password protect them also, or they should automatically be password protected?
I'm guessing you mean the latter because site.com/admin is password protected and when I type in site.com/admin/subfolder I'm also prompted for a password. Is that what you meant? And FWIW, I haven't done anything with the .htaccess file regarding security but I do use one to parse PHP in HTML files.
"The folder permissions really only matter when accessing the server filesystem"
What is the server file system? FTP?
Thanks.