If you really want to hide password from admin you can edit
/wp-content/plugins/wp-mail-smtp/wp_mail_smtp.php
on line 305
change line
<td><input name="smtp_pass" type="text" id="smtp_pass" value="<?php print(get_option('smtp_pass')); ?>" size="40" class="code" /></td>
to
<td><input name="smtp_pass" type="password" id="smtp_pass" value="<?php print(get_option('smtp_pass')); ?>" size="40" class="code" /></td>
Anyway, anybody who just check source code will be able to see password easily. Also this change will be lost after plugin will update in future.
In this case maybe better solution will be add this to your config.php file
define('WPMS_ON', true);
define('WPMS_MAIL_FROM', 'From Email');
define('WPMS_MAIL_FROM_NAME', 'From Name');
define('WPMS_MAILER', 'smtp'); // Possible values 'smtp', 'mail', or 'sendmail'
define('WPMS_SET_RETURN_PATH', 'false'); // Sets $phpmailer->Sender if true
define('WPMS_SMTP_HOST', 'localhost'); // The SMTP mail host
define('WPMS_SMTP_PORT', 25); // The SMTP server port number
define('WPMS_SSL', ''); // Possible values '', 'ssl', 'tls' - note TLS is not STARTTLS
define('WPMS_SMTP_AUTH', true); // True turns on SMTP authentication, false turns it off
define('WPMS_SMTP_USER', 'username'); // SMTP authentication username, only used if WPMS_SMTP_AUTH is true
define('WPMS_SMTP_PASS', 'password'); // SMTP authentication password, only used if WPMS_SMTP_AUTH is true
*/
With correct details. This will disable completely admin area of this plugin, so it will be hidden in your config.php file.
Also keep in mind, that password with smtp for regular email is not the best way how to handle transactional emails for your site.
Check Mandrill which use api key and give you 2000 free emails per month and it works well with this plugin. It is high quality solution for transactional emails available now.