>
> When I initiate the login() it succeeds every time even though it should 
> most definitely be failing. 
>
 
When you pass $user param, it's up to you to authenticate.
https://github.com/cakephp/cakephp/blob/2.0/lib/Cake/Controller/Component/AuthComponent.php#L511

I'll suggest you to create Facebok Auth adapter instead of misusing Basic 
HTTP authentication.
It's all in the bible:
http://book.cakephp.org/2.0/en/core-libraries/components/authentication.html?highlight=auth#creating-stateless-authentication-systems

Regarding Authorize add more code to paste bin.


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