Sharepoint - Web Part Error: Access Denied

Yes there is a solution to restricted document libraries showing up with 'Web Part Error: Access Denied'.

On the restricted document librarly, you can give the build-in Windows Domain Group 'NT AUTHORITY\authenticated users' Site Permissions for 'Open' (Allows users to open a Web site, list, or folder in order to access items inside that container.)

This is a custom permission level that you need to create (you only select 'Site Permissions: Open' permission. Then you assign this permission to 'NT AUTHORITY\authenticated users' - which would apply to any logged in user. Then the user can open the document library without being able to read any items within it.

The error on the web part is due to the user not having enough permission to even open the document library. You can allow the user to open the document library, but not read any content. Then all works well, we use this all the time on both SharePoint 2007 and 2010, and don't get the annoying error on the web page.

I have dozens of dashboard pages that include List View web parts with custom permissions. They all display as expected.

The reason you see this error is because of poorly implemented permissions on lists and libraries. When breaking inheritance at this level you should ensure that default reader groups have the Limited Access permission level applied.

You do not have to take B Bennin's approach. Simply hit each affected list or library and add the Restricted Readers group back with Limited Access. You may even want to try Restricted Read and compare results.

If you also add Audiences to the web part settings this provides the option to completely hide the web part from view, which is often much more pleasant than any empty list view.