Connect to PHP in FB4 is used when you have a PHP Class and you want to use that in FB, for example Employee.php and it has a Employee class and various methods in that like create, update, get, delete.
However, if you have exposed your functionality in PHP as a HTTP URL (i.e. it is not a class), then you should be using HTTPService from the data menu.
So if your file is login.php and is accessible as a URL, then using the HTTPService and enter the URL.
Does this help?
Also a question to that. How can I make sure that my users password wont be exposed will be a simple https be enough? because I always send the data using a flex MD5 class to crypt it putting random numbers inside on know locations. Recalulate the password with the one in the database and compare it. Is that necesarry? or how can i get it more secure because in the services u send it as POST or GET and that would be the plain string otherwise.
Security of data transfers is almost too big a discussion for one reply. Basically, assume that everything you transmit to a server is human readable, even if you use AMF. For logins, definetly a recommendation to use HTTPS. But even if you have that option I would recommend to encrypt passwords before sending them over the wire, which based on your reply you seem to be doing.