You cannot password protect a PDF in such a way that it cannot be cracked in seconds to a minutes when using Acrobat if so inclined. There are thrid-party tools that do a much better job, so much better the only option is a day to weeks long brute force attack against the encryption. Be prepared for serious dollars for this DRM software.
The simple level of password protection is like locks on doors. They help keep honest people honest. As far as watermarking goes, one can make it obnoxious to remove from an image. Other than DRM software, that's the option available.
I haven't had to face submitting PDFs to potentially dishonest people in the past. If I did, I would likely either export as an image and then PDF it, using a watermark on on a master layer, then protect the PDF with simple password protection. Even so, I have a friend who was in a similar situation of submitting artwork to a potential client. They simply hired someone offshore to recreate it from an image for pennies on the dollar.
Adobe sells super-secure systems too. They're for Enterprise and they're super-expensive:
They're the kind of product where no price is listed on the website. You forward your interest and a representative will call you.