Check the man page for "pwconv".

The shadow file has a different layout than the passwd file.
If you mv the /etc/shadow file to something like /etc/shadow_nogood (just in case you want it back later), make sure the passwd file is set up, and use pwconv to "switch" over to a shadowed setup.

Just in case, keep a boot disk handy next time you reboot, although you shouldn't really need it.