If you have a website called say http://example.com and your files that you want to be in your 'Members Area' are say at http://example.com/members then when you go to the Dreamhost htaccess/webdav page on the control panel you would first select your website e.g. http://example.com
Then on the next page you would add your members file folder name to the end of your website (http://example.com) so that it now reads http://example.com/members
Tick the box which says 'Password protect this dir?
In the 'Directory "name":' box type a name for your area such as Members Area or My Groups Files.
In the 'User accounts for this area:' box you would overtype the already added 'user password' entry with a user name and a password. The user name does not have to be any of your already created user names but could be something like 'members' or 'year2012'. The password is as you'd expect a good mix of letters and numbers and characters like % etc.
At this point you can select the 'Forbid linking to files in this dir?
' if you wish which is to stop people with websites elsewhere linking to your images and media files unless you wish them to. In which case you could add their website to the box shown.
Click the 'change these settings' button and after a few minutes the .htaccess file will appear in your http://example.com/members folder and this folder will then be protected requiring the 'user password' combination to be entered.
Note that any folders beneath http://example.com/members will also be protected by the same user/password. So http://example.com/members/test/area will be protected as well.
If you have protected http://example.com with a user/password then the whole site will be protected by that user/password.
You can Google .htaccess to get some useful information but be careful what you do as you can lock yourself out of your website. Although you would just need to delete the problem .htaccess file via ftp or ssh.