although I still prefer yum to apt-get...
I much prefer pacman to any of them
It is not stupid by any means, the system stores information all over the place. It would be to hard to try and encrypt each one by itself. It is far easier to just encrypt the whole thing. You would be surprised how little of a hit you take in performance. I used TrueCrypt for a good while and I never notices any slow down at all. Encryption like AES are extremely fast.
System encryption provides the highest level of security and privacy, because all files, including any temporary files that Windows and applications create on the system partition (typically, without your knowledge or consent), hibernation files, swap files, etc., are always permanently encrypted (even when power supply is suddenly interrupted). Windows also records large amounts of potentially sensitive data, such as the names and locations of files you open, applications you run, etc. All such log files and registry entries are always permanently encrypted too.
We understand what he means, but if you did not read the update here you go
This doesn’t mean that your password has been shortened. Actually, Windows Live ID passwords were always limited to 16 characters—any additional password characters were ignored by the sign-in process. When we changed “Windows Live ID” to “Microsoft account,” we also updated the sign-in page to let you know that only the first 16 characters of your password are necessary. To avoid this error message in the future, you only need to enter the first 16 characters of your password.