Why should I care about hashing passwords anyway?

Question

If a hacker has access to the hashes in my DB, he has access to the rest of the information in the DB anyways. So why would he bother trying to decrypt the passwords? Should

Answer 1

Should I be storing the passwords on a different server to the rest of my data?

This adds complexity to your system, but if it's something you can do it's definitely an improvement.

Note that using authentication servers such as Kerberos, RADIUS, or Windows domain authentication effectively put you passwords on another server.