Isn't this true of SSH as well? What's stopping someone from letting sshd listen on 0.0.0.0 with password auth? Anyway, I would expect that whether you're using ssh or rsh/telnet/etc that you're not configuring it for password auth, but rather using tailscale authentication. Specifically, I would expect (perhaps naively) that tailscaled handles the ssh/telnet/rsh/whatever connections rather than passing them off to another process (sshd, telnetd, etc) and thus allowing it to handle the authentication and daemon configuration (e.g., what address it listens on).

How does that work? First of all, I would expect that rsh-over-tailscale doesn't use password authentication, and secondly can a local user sniff traffic before it hits tailscaled?