also keep in mind that if you mount your encrypted volume, that your truecrypt password is unencrypted in RAM.
I thought the password was only kept in RAM if you had the Cache option selected, which I don't. How would I retrieve the password for my volume from RAM anyway?
And, another thing, if the bitcoin app is using encryption itself for the wallet file, doesn't it have to decrypt the file and keep it in memory to work with it? How is there a difference then between having it on a truecrypt volume, and having the encryption/decryption handled from within the bitcoin app? Oh, and I use XP Pro, I know how to encrypt files on NTFS 5, but I also know that windows does not leave a file only encrypted when the file is in use, no, it decrypts it into RAM so it can be worked with, and encrypts it to the hard drive whenever the file's content changes, constantly, on the fly. Just like TrueCrypt does, and just like the bitcoin app would do if it was handling the encryption. I really see absolutely no difference which way it's being handled because there will always be an unencrypted version in memory. But, the unencrypted volume is accessible to the person who is currently able to read it, so, modifying file permissions in an encrypted volume would be good. And adding Windows NTFS encryption would also be good, so if someone tries to grab the wallet file from the unencrypted volume, they will only get an encrypted file they can't use.