I do not appear to have any problems running encrypted mode. Although I have done a few $0.01 test orders using Credit Card (via PayPal) and a personal PayPal account, I am still waiting to get public orders in that use PayPal.
After I installed the module, I first received a string of errors just before or after the CONFIRMATION page, but then I moved my Private Key, Public Certificate and PayPal's Public Certificate into a folder under my catalog's admin folder which is is protected with htaccess. I also chmod the "Working Directory" to 0777. (that should not be in a public folder), but in the root, eg. /home/site/osctemp/.