I knew someone would ask. This is how I pictured it at that moment:

If server intercepts the encrypted password from one client and sends its own instead of legitimate one you could simply implement manual verification. Jim tells Bob: "Ok bob I'm gonna give you remote support. Encrypted password is doughnut. Start up the program"
Bob: "Ok"  ./ReMoteSupport doughnut.
ReMoteSupport sends public key expecting that response will be string doughnut encrypted with his public key. If its not Bob sues Chris :)

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