Should I use models OR libraries?

[eluser]xwero[/eluser]
If you have a bunch of functions that depend on each other to achieve a goal then you have a library. Take a look at the CI libraries.

If the functions are stand alone for the most part put them in a helper.

if it's a stand alone function you can't categorize put it in a plugin.

From the function names you provided i would create a auth_helper for the gen_password and clear_login_attempts and a email plugin for the send_email function.