Yes, yes, and no. Add a passphrase and you are spinning up a completely different wallet. New xpub and no way to discern that it has any connection to the original wallet

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Thanks - so do I need to reconnect the hww to the watching wallet if I want to set a new passphrase? As the additional word would be stored in the hww 🤔

No. The watching wallet would still only watch the wallet whose xpub was entered for it. The HWW would generate the new wallet with the new passphrase and then you would have to export that new xpub to a software watching wallet

Thank you! That makes a lot more sense. Finally feel like I’ve got this one figured out 🫡