First, I would just like to show my amusement that you are working with a program that should help children's grammar, but in your post you made some grammar mistakes. Mostly the use of the word there rather than their, I found it kind of funny. Not saying that I'm an English professor, far from it.

Here’s a possible solution that would depend on your programming skills and willingness to get this program working. Create a program that the students/teachers could log into. Your program then goes out to a secure folder and checks for their username and password. If it is found, then your program can move (copy) the file from the secure area into the normal program area and rename it 1.txt (or whatever). Then your program could activate the teaching program, enter the username and password (automatically), and send a carriage return (enter). Then, when the teaching program is finished, the user would log out on the program, and then log out from your program. At that time you could move back (or delete if you copied) the 1.txt file.

If the program gives you a choice where to install, then you could just put it in c:\, at least you could still stop access to c:\program files. You might also be able to find a special setting that could change the location of the .txt password files.