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Nayan,
Yes as a general improvement I think its fair to say that not everyone wants to use 'email addresses' but if they are used then we should use the email address to send email to user - So
1) Ability to create a user, if 'use email' is ticked, you must enter an email address and the password for this account will be auto generated and emailed to the address
2) Ability to create a user, if 'use email' is not ticked, email address field does not appear, instead password and repeat password fields appear and they must be provided when creating a user.
so 1) is what is in use at present (except we dont have this 'use email' option which should default to true if not provided to keep things backwards compatabile.)
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