Your “break” modification from above is something that should not be required. I’m not sure if this will break other things. But good to hear that you finally got an installer. Still you should try to undo your modification and build the installer again.
Did you remove thPanda3D directory by hand? Might be that your attempt to create an installer from within left some artifacts, artifacts which won’t get removed by simply uninstalling Panda3D. So re-installing might give you a messed up Panda3D again.
Hiding code from a user is, well, an illusion. This is true for any software, written in any language. It is just a matter of how much effort someone has to spend on hacking your application.
Read through the packpanda script. There is an option to compile .py to .pyc and only distribute .pyc files (Python bytecode). Bytecode is not human readable, but it is possible to reverse engineer. For 99% of home-brew games this will be more than sufficient. If not: learn to be better than the best hackers, and come back in, say, 30 years.
By the way: py2exe does not provide any better protection. It just packs all .pyc files into a zip archive (which can be appended to the .exe). The zip archive can be extracted very easily, and then a hacker has the bytecode again.
enn0x