Currently, kerberized services do not make use of PAM at all — a
kerberized server bypasses PAM completely. Applications that use PAM
can make use of Kerberos for password-checking if the pam_krb5 module
(provided in the pam_krb5 package) is installed.
The pam_krb5 package contains sample configuration
files that will allow services like login and
gdm to authenticate users and obtain initial
credentials using their passwords. Provided that access to network
servers is always done using kerberized services (or services that use
GSS-API, like IMAP), the network can be considered reasonably safe.
Careful system administrators will not add Kerberos password-checking to
network services, because most of the protocols used by these services
do not encrypt the password before sending it over the network —
obviously something you'd want to avoid.