I believe that when you run BulkRegister, the password gets set to some randomly generated value. That's fine if the user doesn't exist in .htpasswd, but it makes things very difficult if they do.
Why would they already exist? One reason is one may be developing a NewUserTemplate or VIEW_TEMPLATE and it's the only way to "reimage" the user's home page.
Fixed in develop. Someone fix it in 4.0.x?