The password is not encrypting the wallet itself, but it locks the sending action. That mean each wallet can be loaded and viewed, the password will be used/needed only when you try to spend.
Once you know that, you realize that an encrypted Wallet is a local information. The blockchain does not see the difference between the 2 wallets, this information is not shared. From outside, the peers and the network, encrypted wallet or not these wallets are the same.
But, if you try the password of wallet1 to unlock wallet2 for spending coins it will not work and vice versa.
The address used are not affected by the passphrase. The only thing affected as I said is the action of spending. Everything else is working normally. So if you generate an address on wallet1 and someone send money to this address, both wallet will receive the money, as they are the same wallet, locally protected by a different password.
I have a case where I run two different nodes with a copy of same wallet and same address. What happens if I change the passphrase on wallet #1, will the wallet #2 which runxs on different location with same address also change passphrase or this is locked to a specific file and not a address?
thank you for your help in advance.