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Apple OS X and Parallels Windows 7 encryption

I'm testing a new MacBook Pro i7 laptop using Parallels to support Windows 7 Ultimate.  I need to encrypt a portion of the system where secured data will be stored.  While in Windows 7, I cannot use Bitlocker to secure the C: drive (which I really don't want to do anyway), but I can't secure the virtual drive Windows 7 is running on either.

I looked at File Vault in OS X, but I'm not certain that is a sound alternative.  The system warns that SMB file sharing and printer sharing will not work after the encryption.  

This seems to be an acceptable solution.  I'm not sharing my files or a printer, but is there a better alternative?
1 Solution
From within windows 7 locate the folder you wish to use to store your encrypted content,
Right-click that folder and select 'properties', from the general tab select 'advanced' and check the last check-box 'enrypt contents to secure data'

Would this not be sufficient?
Parallels works fine with FIlevault encryption of the home directory, there may be a performance hit but on modern machines it isnt so bad as to prevent its use.

The message you are receiving is normal, it means that you wont be able to use your user i.e joe.bloggs to connect to your mac via SMB from another machine. It isn't related to the virtual machines which will be able to connect to anything as normal.

If you want to protect the entire windows installation then its your best bet. You could use EFS or something like truecrypt in windows if you want to protect specific parts....
Filevault does have a fair performance hit on a mac - of any spec.  I recently turned it off on a drive I was using for video work because it was very slow.

The best alternative I found was to create an encrypted disk image on the macintosh using disk utility in OS X and then store any confidential/sensitive files there.

To access the disks from parallels you can set the disk image to mount at start up of the macintosh (password protected) and then folder share this to windows through the parallels preferences for that virtual machine.

Then unmount the encrypted disk when you finish or when it's not in use. Make sure it's more secure by NOT saving the password for the disk image in your OSX keychain.
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Strong agreement with roylong! I was going to make the same suggestion, but this is well said and accurate. (not fishing for points)
cmmcginnAuthor Commented:
Thanks, guys.  

Well, I need a lot of different material to be encrypted - in a variety of folders.  I'd really prefer to encrypt an entire drive instead of folder-by-folder.

I use PGP on our PC laptops.  In Windows 7, I've found it somewhat buggy.  TrueCrypt appears to be a good alternative.  I've used it on a tiny netbook for awhile now with no issues whatsoever.  It appears to do everything PGP does with drive and partition encryption at high standards of security, but it's not buggy at all, and it's free.

The OS X utility you referred to sounds much like PGP or TrueCrype.  I'll take a look.

Thanks to everyone.
You could make one folder that gets encrypted and put the various unrelated in that folder. Then you could make aliases to those folders. Whenever you clicked on the folder, it would ask for a pw to unlock the folder. It would work a lot like a virtual partition. Cheers
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