How to change or delete Personal Hotspot password on Mac side?
I took the pair of the Mac and the iPhone 7+ to the Apple store. I demonstrated the problem, we rebooted both machines, and demonstrated the problem persisting. 

The troubleshooter gave the phone a "Vulcan death pinch" squeezing the lower volume key on the left simultaneously with the usual power key on the right, holding them until the phone fully rebooted to the Apple icon on the screen, releasing only then. He said it's a hard reset, and different on different iPhone model numbers. After that, we toggled the Personal Hotspot button in the Settings app on the iPhone, making sure it's on, and chose the Personal Hotspot from the wifi gadget on the upper right of the top menu bar of the Mac and the Mac asked for the Personal Hotspot password, which I copied off the phone. 

To repeat and emphasize, we hard-reset the iPhone without changing the Mac. We didn't have to do anything extraordinary on the Mac, not even open the System Preferences Network dialog.