A couple of concerns:
1. If I understand this correctly, anyone who can access my Library folder could reset the master password?
2. Having reset the password, what does "*same exact* password and encryption settings as you chose last time" mean? I guess it must mean "the settings for password and encryption", because I've forgottent the password, right

But anyway, what specifically has to be exactly the same as last time?
My underlying issue is: are there any circumstances in which I wouldn't be able to recover the data?