2) running an sshd IDS that A) tests for '(for invalid user|Failed
 password for)', B) blacholes source hosts 'ipfw add deny ...', and
 C) alerts sysadmin or operations personnel,

Be careful with adding ip addresses to deny via a packet filter.
If an attacker uses spoofed IP adresses, you may produce yourself
easily a denial of service attack.

Not sure I agree with the easily part.  TCP transport plus SSH
protocol spoofing is not a vector that normally needs to be secured
beyond what is already done in the kernel and router.  That's not to
say such spoofing cannot be done, just that it is rare and would
require a compromised router or localnet host at a minimum.

Say I used the IP address of your default gateway. If you don't check that and just add a deny rule... well... bad luck ;-)

I would hope that your router doesn't accept packets with its own
source address.  But this does bring up a good point i.e, that no
IDS should be operated without a well thought-out whitelist.

--
Roger Marquis
Roble Systems Consulting
http://www.roble.com/
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