We solved the issue with the password prompts. It was the domain controllers causing the issues. We solved it by setting up a load balancing solution with NetScaler over 6 different domain controllers.
However the "HTTP JVM: WARNING: CLFAD0251W: Requesting user authentication. HTTP Code: 401" still shows on the console.
We tried installing version 9.0.1.7 of Traveler and HF417 for Domino 9.0.1FP4 but still the same. The environment is working but we would like for the message to not show.