Thank you for your post.
You can use the OAuth authentication during your project creation - in this case, your encrypted credentials won't be stored in the project file. Currently, this functionality in available in The Welkin Suite for Windows and soon we will work on it in TWS for Mac.
As for corresponding your Salesforce orgs to different GIT branches - you can create separate projects and connect each of them to the necessary branch using the implemented Git Support. All the details about this functionality you can find here (for Windows) and here (for Mac).
If you have any additional questions, please share them with us. We will be happy to answer them.