dovecot - Sep 2011 - default_pass_scheme = PLAIN and blank password

I'm using Dovecot 1.2.15 on Ubuntu, but I think this applies to other
versions as well. I store user info and passwords in MySQL. It appears
'default_pass_scheme = PLAIN' allows blank passwords. My question is:
Is this a bug or is this by design? If it is by design, is there a
setting that I'm not aware of that changes this behavior? Of course
let me know if you need additional info on the setup I'm using.

Thank you,
Gary V