Security System File and Folder Encryption Question

[WilsonF]

On my T42p, I have the security chip, UVM manager, and power on and HDD password protection enabled, and I use the fingerprint reader to login.

When I try to use the security chip to encrypt a subfolder in My Documents, I get a folder full of individually-encrypted files (each ending in a $enc (I think) extension.

With my last T42, I had all of the above except the fingerprint reader enabled (it didin't have a FP reader) and I got an encrypted folder that was usable seamlessly without decrypting.

What am I doing wrong with this machine?

Thanks.