If you have Security assist 2 installed, you would not install data bridge as well. but the version would be listed in the Extension manager.
With Password encryption, the register pages stores the encrypted password in the data base.
on the login page, the password entered to the login form then gets encrypted to compare against the value in the database.
Encryption is a one way process, once encrypted, it cannot be decrypted,
the forgot password page is really a password reset, it sends a link through email back to the forgot password page that lets the user set a new password.
it is really mush easier to re run the wizard to create pages using encryption rather than to manually edit existing ones.