I am using PHP\'s mcrypt
library and the AES-256
(rijndael) algorithm, which requires both a key + initialization vector to run.
My logical br
No, in fact an IV is vital in most implementations. The IV is also considered to be safe for public use, for instance the IV is transmitted in plain text for WEP and WPA1/WPA2. The problem arises when this same key+iv is used to encrypt the same plain text. The cipher texts will be identical, unless you use an IV. If an attacker can encrypt arbitrary plain text with this key, and then view the cipher text. This is a much faster way of brute forcing other cipher text that the attacker has obtained.
Not only that, the IV must be random or you would be in violation of CWE-329. The reason why this is a problem is a bit more subtle and I didn't get it at first. You didn't mention this, but i hope you are using either the CBC or CMAC modes
The use of a hash function on a password is nearly identical to using a String2Key function. This is a solid design so long as an attacker can't use SQL Injection to obtain the key.