How Folder Guard works
The most important fact to understand about how Folder Guard works is that it protects files and folders without encrypting them.
What is the difference between password protection and encryption?
Think of Folder Guard as a virtual guard standing between the user and the protected files and folders. When you want to open a password-protected folder , the guard asks you to say the secret word or phrase. If you say it right, it lets you through. The files and folders themselves are not changed in any way, they remain as they were before.
Contrast that with encryption : it actually rearranges the bytes in the files and folders and replaces them with different bytes according to the encryption key. Only the encryption key is protected with the password, the files and folders remain fully accessible, but scrambled.
Can the protection be removed without the password?
Continuing the virtual guard analogy, a skillful hacker could assasinate the guard and remove the obsticle between the user and the protected files. On the other hand, with encryption, it's impossible to unscrable the encrypted files without recovering the correct encryption key.
Considering that Folder Guard protects the folders without encrypting them, it's possible for someone who has sufficient knowledge and expertise to "assasinate" Folder Guard by disabling its software services, and thus bypass the protection. Does it mean that Folder Guard is useless? No, or militaries around the world would not be using the guards to keep unauthorised people away from their assets. It all depends on who you are protecting your files from, and how exactly your want the files to be protected.
How Folder Guard performs the protection
You don't need to know the technical details of how Folder Guard operates in order to use it, but if you are curious, read on.
As you probably know, most Windows programs don't work with files and folders directly; they rely on the support provided by the Windows operating system to work with files and folders. (It makes each program able to work with wide range of the storage devices, letting Windows take care of the details). For example, if you use Windows Notepad to open a text document, the Notepad program first prepares a special request for the contents of the disk and sends this request to Windows. Having received the request, Windows searches its internal data structures and the contents of the disks, and returns the results back to Notepad, which in turn shows the files and folders to you in the Open File window. After you have selected the file and pressed OK, Notepad prepares another request for opening the file you have selected, and sends it to Windows, as well. Windows reads the appropriate bytes of data from the disk and returns them back to Notepad that shows them to you in its window. In reality, the procedure is much more complex: even a simple operation like the one described above may take hundreds of different requests sent back and forth between the program and Windows, before you can see the results on the screen. All such requests and actions are performed by the programs transparently to you, and you don't even have to know what is going on under the Windows hood, unless you really want to.
Folder Guard works by intercepting the system requests that Windows programs and Windows itself exchange between each other. Folder Guard analyses the requests and the data they contain, and uses the attributes of the files and folders that you have set up with Folder Guard to allow or deny such requests. For example, if you designated a file to be read-only, and some program sends a request to read information from this file, Folder Guard allows such request to go through without intervention, and passes the results from Windows back to the program. If, however, a program sends a request to write some data into such file, Folder Guard intercepts it, and returns it back to the program without passing it to Windows. This prevents the file from being overridden (as per the read-only attribute), and makes the program display an error message such as "Access denied" or similar.