This ATV works absolutely flawlessly with OS X, and is VERY fast indeed at transferring data. It also has a lifetime warrantee!
As for encryption, you want to make sure the drive stays formatted with FAT32, and you can then use "truecrypt" (free and VERY secure) to encrypt/decrypt data. There are windows AND Mac versions - the interface is identical in both, and you can get portable versions; IE you dump the executables/folders for truecrypt on the ATV drive, launch the OS specific version of truecrypt from the ATV (no install needed) and then create virtual disk images within the drive, which you mount with truecrypt from within either OS (sounds harder than it actually is - it is VERY easy!).