The purpose of the service account user is to do operations inside the VM, like configure IP, disk and so on, so if the service account is disabled or deleted all operations regarding the OS will not work.
How is communication secured?
We use the VMWare Client Tools to communication with the VM so the security is based on this. We create the service account user when provisioning a VM so it will be the same name for both Windows and Linux VM's.
Is the same password used for all VMs?
No, a different password is used for each VM, which are stored in the database. The passwords are encrypted.
Can I change the default name?
Yes, you can change the default name used in Settings > Configuration > Defaults