Re-reading my post revealed something that needs clarification - project server accounts don't necessarily have to use project server authentication. They can. OR they can use windows authentication from the active directory.
Project server accounts basically provide the mechanism for users, regardless of authentication method, to gain access to the parts of the project server software that you want them to see.
That's what I should have said first time. Sorry for any confusion.
Earl
To add to what Dale's already said, project server accounts use a specific authentication model, i.e. it's built into the project server database.
Windows authenticated accounts use the active directory that the project server is pointed to for their authentication credentials.
Project server accounts will not be able to access the documents, issues and risks (windows sharepoint services) associated with the project server installation, if sharepoint is in use for your installation.
Earl
what am I setting up when I set up a project server account. It looks as if I
can create several accounts. Is this a way of categorizing my projects?