iPod Classic. Bonus: Doubles as an MP3 player.
Other than that, they're all pretty interchangeable. You could buy an external enclosure, and use an old internal HDD. It's what I'd do, but I also have old hard drives.
Also, does it mater if the drive gives the option to protect my files using a password?
Probably not? Are external drives commonly stolen where you're from? Are you going to keep confidential/sensitive data on this drive? Actually, I seem to remember some "password protected" external drives whose security could be cracked by not running the supplied software.
Do they all have the option or is that something I would look for in virus protection software?
That is something you'd look for in file encryption software.