[WarmonkEd]

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If there was a third person after me, I would've definitely raised to protect my hand. Heads up, however, I find that most will call the raise and I won't be able to protect.

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I think you played it alright. I agree raising the flop does nothing to protect your hand, because no one will fold for 1 SB.

edit: I suppose the merit of raising the flop is that it might get him to fold for 1 BB on the turn or allow you to get a free card.

Dane makes a good point about letting him bluff the turn and river. I think the decision to raise or let him bluff is very dependent on your read of the opponent.