Can I create a brand new encrypted wallet? I thought I could only create a wallet and then encrypt it. i.e., if I had malware already that would copy the wallet.dat as soon as it was created, it would get the unencrypted copy before I had a chance to encrypt. – Stephen Gornick – 2011-09-25T17:34:21.957

Yeah, I think you're right about that. I was addressing the case where you have some old backup that someone could possibly get ahold of (that's the way you put it in your question). The case where you have malware insta-stealing your new wallet I'm not sure about. – D.H. - bitcoin.se – 2011-09-25T18:00:52.487

3@Stephen: irrelevant. If you had a malware you could also have a keylogger that would get your passphrase, or whatever else. – o0'. – 2011-09-26T07:15:14.717

1You can start the client with -keypool=1, then encrypt the wallet, and then restart normally and add an address. Only one key ever touched your hard drive then in unencrypted form. There should be an option to force a new wallet to be created directly in encrypted mode though, but that'll be for after bitcoin-qt is merged. – Pieter Wuille – 2011-09-26T10:12:08.300

Apparently there were problems with the encryption of existing key pool entries. https://bitcointalk.org/index.php?topic=51604.0

How to transfer all funds to new keys http://bitcoin.stackexchange.com/questions/1272/how-can-i-transfer-all-funds-to-new-keys

Gotta also remember to not re-use any addresses generated prior to encryption. http://bitcointalk.org/index.php?topic=77314.msg859310#msg859310 It is probably best to simply archive the old wallet.dat and start with a new, empty wallet and encrypt it before any receiving any coins.