I like that you said you let PageRank flow freely throughout your site. I think that’s good and I’ve steered many friends and clients to using WordPress for their website for this very reason. With WordPress, it seems obvious that each piece of content has an actual home (perma links) and so it would seem logical that Google and other search engines will figure out that structure pretty easily.
Robots.txt is not an appropriate or effective way of blocking sensitive or confidential material. It only instructs well-behaved crawlers that the pages are not for them, but it does not prevent your server from delivering those pages to a browser that requests them. One reason is that search engines could still reference the URLs you block (showing just the URL, no title or snippet) if there happen to be links to those URLs somewhere on the Internet (like referrer logs). Also, non-compliant or rogue search engines that don't acknowledge the Robots Exclusion Standard could disobey the instructions of your robots.txt. Finally, a curious user could examine the directories or subdirectories in your robots.txt file and guess the URL of the content that you don't want seen.
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