Plaintext passwords is bad! Bad Bad Bad! I think you are on the right track with sending them to a web page (email, or user agreement) which explains why passwords given to them are 'crazy' looking, and how they can then change them themselves to the more easily cracked 'favorite color' password they are likely used to. When regsitering on your site, do you have a 'Write a question to help remember your password', and 'Answer' boxes? This helps people remember their passwords, as well as 'Enter your username and your password will be mailed to you' thing. Although many users are dolts, security shouldn't be loosened to accommodate them, rather tightened to protect themselves from themselves (remember, some people still have post-it notes of their passwords sticking to their monitors). Just MO :)

Cheers,
KM