Nope, no conflict at all. You're fine to authenticate your PPP with CHAP and your OSPF with whatever at the same time.
Code:
R5#sh ip ospf nei
Neighbor ID Pri State Dead Time Address Interface
10.1.3.3 0 FULL/ - 00:00:36 10.0.35.3 Serial0/1
R5#sh ip ospf int s0/1 | i auth
Message digest authentication enabled
R5#sh ppp int s0/1 | i Auth
Se0/1 LCP: AuthProto CHAP (0x0305C22305)
Se0/1 LCP: AuthProto CHAP (0x0305C22305)
R5#sh run int s0/1
Building configuration...
Current configuration : 228 bytes
!
interface Serial0/1
ip address 10.0.35.35 255.255.255.0
encapsulation ppp
ip ospf authentication message-digest
ip ospf message-digest-key 1 md5 blah
ip ospf 1 area 0
ppp authentication chap
serial restart-delay 0
end