A 1 is only auto-fail on attacks.
My view is that, if player puts a lot of resources into having a high passive perception like that, it's fine that you 'cant hide things from them'. It means as long as the player decides to look, they'll find whatever it is - and they built a character meant to search for things so great! They should succeed at what they are best at most (if not all) of the time. But, as the GM, you have other tools to make the player face tradeoffs and risk twists and danger (whcih is why we want to 'hide' things from players in the first place). A 24 perception doesn't mean you instantly notice, searching takes time and effort.
In fact, that's what I liked about the 4e perception rules -- because really, with enough time you'll find anything. I much prefer the "take 10", now that I think of it, to minimum Perception based on passive (and maybe you get to add passive bonuses to a 'take 10' - it takes 10 minutes after all). What matters is the time. In circumstances where you are pressed for time, taking 10 isn't possible, you search hastily and so you roll. Now the +9 Perception character failing to find something makes sense - even Sherlock can miss something when under the right kind of pressure.