Excel 2003/2010 Password incompatibility issue

I have a spreadsheet initially created in 2003. We had a software upgrade last week to 2010 and I saved the file with password protection. The sheet is shared but is now completely locked, with no data entry allowed whatsoever by anyone and no password prompt is given to the user either. When I go to the Options view and look at Permissions the only available option is Restrict Permission by People all the others are greyed out. The option chosen is Unrestricted Access. The options on the Review tab are also greyed out except for Share Workbook and Protect Shared Workbook. Changing either of these makes no difference whatsoever to the options available on the File/Permissions option. Anyone any ideas on how to get this back to normal? It's making my brain hurt