Wrong exception shown to user when unauthorized or when using wrong credentials to publish report to BA Server

Currently when you are unauthorized or have the wrong credentials to publish a PRD Report to the Server you are shown the following exception:

<snip>
java.lang.RuntimeException: org.pentaho.reporting.designer.extensions.pentaho.repository.util.PublishException: The File exists and override has not been specified.
at org.pentaho.reporting.designer.extensions.pentaho.repository.actions.UpdateReservedCharsTask.run(UpdateReservedCharsTask.java:90)
</snip>

Please see attached screenshots.

In order to dig further you have to check the PRD log located in the following place:
C:\Users\USERNAME\.pentaho\logs\prd.log

And locate the following error:

Caused by: com.sun.jersey.api.client.UniformInterfaceException: GET http://localhost:8520/pentaho/api/repo/files/tree?depth=-1&filter=*&showHidden=true returned a response status of 401 Unauthorized
	at com.sun.jersey.api.client.WebResource.handle(WebResource.java:686)
	at com.sun.jersey.api.client.WebResource.access$200(WebResource.java:74)
	at com.sun.jersey.api.client.WebResource$Builder.get(WebResource.java:507)
	at org.pentaho.reporting.libraries.pensol.JCRSolutionFileModel.refresh(JCRSolutionFileModel.java:115)
	at org.pentaho.reporting.libraries.pensol.JCRSolutionFileModel.lookupNode(JCRSolutionFileModel.java:308)
	at org.pentaho.reporting.libraries.pensol.JCRSolutionFileModel.exists(JCRSolutionFileModel.java:193)
	at org.pentaho.reporting.libraries.pensol.WebSolutionFileObject.doGetType(WebSolutionFileObject.java:81)
	... 19 more

A typical scenario for this situation is publishing with the wrong password.

In order to replicate please follow these steps:
1 - On a vanilla installation of the BA Server
2 - Log as admin
3 - Go to Administration Perspective
4 - Select User and Roles Perspective
5 - Select admin user and click on Edit next to password
6 - Change the default password to pentaho
7 - Log out and log back in using admin/pentaho
8 - Open Pentaho Report Designer
9 - Select a sample Report from Help > Sample Reports
10 - Publish the report
11 - In the publish dialog type username= admin password= password
12 - Notice the error as shown in the screenshots
13 - click ok and select the red exclamation mark from the bottom right corner and notice the exception is not the appropriate exception

Expected Result:
To show the publisher the not authorized error

Actual Result:
Confusing error shown to the publisher

Screenshot/Video attached:
https://pentaho.box.com/s/hqpuqbljf6ajarkvfwsvp4pi4djea9ms
Full Logs attached: please see prd.log