What currently is the most fluid on-the-fly-encryption available for the single user? ScramDisk, BestCrypt and PGPDisk seem to be the ones most talked about which have source available (anti-backdoor). Ideally one would like features that are similar corporate systems like Pointsec (unavailable to the general consumer)!
I personally use Encryption Plus Folders from PCGuardian, as well as PGP for on-the-fly-encryption without any problems. Both are easy to use, and come with a choice of algorithms.
Because both use passwords as crypto keys, the security is only as good as the password.
An easy-to-guess or poorly protected password and keystroke monitoring are basic threats to most of the personal crypto products.There's a pretty thorough analysis of a whole range of similar products at http://www.fortunecity.com/skyscraper/true/882/CertainOTFESecurityFlaws.htm.
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