Follow all the steps but still always asking for password access This seems to be the point where, with most of these type devises, you are unable to get by, and I'm not exactly sure how to proceed.
It seems that the windows 7 machine would like you to access it by using the following format
MachineName\Username (That is the Windows 7 Machine's netbios name followed by a backslash and then a username with appropriate permissons) and then the password for that user.
However it seems that in most instances, these types of devices don't have the capacity to use the backslash character in the username field.
I have read some reports that some have been successful by enabling the guest account on the Windows 7 machine, seems like a big security hole to me. I have read elsewhere that some have been successful by specifically granting the NETWORK group full controll to the shared directory you are trying to access, under the security tab for ntfs permissions, although I would think that the everyone group would pretty much include, well....everyone. So I don't see how that would help. I have also read that some people have had success updating the firmware on their particular device, which evidently includes a newer version of SMB. Beware, I think a firmware update in some instances may wipe the data on the device.
Also on the Windows 7 machine make sure that IPv6 is disabled and if you're in a homegroup.....leave it, workgroup sharing is what we're talking about anyway....as a matter of fact generally I would recommend going into folder options, under the view tab and turning off by unchecking Use sharing Wizard, should be near the bottom.
If you are able to resolve this issue, please post back your solution as there are a ton of people with this same problem.
Yesterday was, Today is, but ahh Tomorrow...mystery, suspense and a promise of hope.

Operating System Windows 7 Ultimate 64 bit
Computer Type Home built
OS Service Pack Service Pack 1
Internet Explorer Version IE9
DirectX Version 11
CPU Type and Speed AMD Phenom II X6 1090T Black Edition Thuban 3.2GHz
CPU Cooling Stock Factory Cooler
CPU Idle Temp 32C
Motherboard Chipset GIGABYTE GA-870A-UD3 AM3 AMD 870
System BIOS Revision Award F5a (beta) 11/15/2010
System Memory Type G.SKILL Ripjaws Series 16GB (4 x 4GB) 240-Pin DDR3 SDRAM DDR3 1333 (PC3 10666)
System Memory Speed 1333 currently underclocked to 1066
System Memory Clocking 7, 7, 7, 20
Video Card Type and Speed Nvidia GeForce GTS 450 1Gig DDR5 DX11
Video Card Cooling stock
Video Card Temperature 32C idle
Power Supply Unit (PSU) Antec EarthWatts EA750 PSU
Computer Monitor Dual Dell ST2320L
Sound Card Integrated RealTek HDA
Speakers Klipsch
Headset/Microphone Altec Lansing
Hard Drive Two Seagate 500 gig SATAII's ST3500418AS ATA
Optical Drives Lite-On DVDRW x2
Keyboard and Mouse Logitech USB Optical
Modem-Router Type Arris MODEL: TM602G / Microsoft MN700
Network Adapter Realtek RTL8102E/RTL8103E Family PCI-E Fast Ethernet NIC
Printer HP InkJet 990cxi
Network Speed WD Passport 500gig USB 3.0 BackupDrive
USB Controller NEC Electronics USB 3.0 Root Hub
Gaming Console Xbox 360
Anti-virus Software Microsoft Security Essentials
Productivity Suite Office Pro Plus 2010
System Install Date 2011-01-25 21:59:23 on this drive
Computer Skill Level Certified Professional
Windows Experience Index 7.2
Favorite Game FarCry (original, 2 sucked)