rsync with ssh

[Adrian Mak]

I'm new on rsync, and I have some question regarding file synchronization
my rsyncd.conf is
secrets file = /etc/rsyncd.secrets
read only = yes
list = yes
uid = nobody
gid = nobody
max connections = 1
log file = /var/log/rsyncd.log
pid file = /var/run/rsyncd.pid
lock file = /var/run/rsync.lock

[test]
path = /home/test
auth users = test

on another linux, I executed
rsync --verbose --progress --recursive --delete
test at 123.123.123::test/ /home/test2
with no problem on file synchronization

but it seems that rsync sending plain password for the user test and
the contents too. Then I digged the documenation and  for more secure,
ssh is the choice. right ?!

rsync with ssh, I executed
rsync --verbose --progress --recursive -rsh=/usr/bin/ssh --delete
123.123.123:test/ /home/test2

but it said
receiving file list ...
link_stat /test : No such file or directory

however if I  provide the full remote path
rsync --verbose --progress --recursive -rsh=/usr/bin/ssh --delete
123.123.123:/home/test /home/test2

and it success. And it seems the remote host does not need rsync to be
run in daemon and  rsync with ssh, I can put any path of remotehost

Am I right ?