I have included TrueCrypt in PC/OS since release 2008 and its a very good tool. A basic breakdown is that you can create virtual containers or you can encrypt an entire device. Well I have had several experiences with the Virtual Containers so I decided to do a spare USB key that I had as well as a 10 gig USB external drive that I had for data use.
Setting up the volumes was not hard, you just had to click on Create Volume and click on create a volume within a partition and device select your device and continue. Under PC/OS you need to know the device name /dev/sd* and you can encrypt the entire device.
Performance in encrypting is great, no slowdowns and even though its connected through USB its still pretty fast. I noticed no significant slowdowns regarding file transfer either.
I have never tried encrypting a drive and trying to install PC/OS on that drive. Im assuming it would work equally well but I just dont have the spare drives with which to test.
Overall, for data encryption TrueCrypt is a great tool and a worthy edition to any Linux distribution.
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