I wrote some encryption modules for the linux kernel. The modules use the loop device, which means that you can create an encrypted filesytem within a regular file.
The approach I use is independent from the medium on which the filesystem is stored. So you are able to mount an encrypted filesystem via NFS or to burn the filesystem on a CD-ROM. The decryption always takes place on your local computer, so if an encrypted filesystem is mounted via NFS the network traffic is also encrypted.
The modules were compiled with linux-2.4.8, but they should
work for any linux-2.4.
I was wrong (sigh) there were some changes in the kernel APIs,
that breaks my encryption module for recent kernels.
So finally I updated my module code and now it works