This article is from the CD-Recordable FAQ, by Andy McFadden (email@example.com) with numerous contributions by others.
The easiest way is to use your favorite compression or encryption utility
and process the files before putting them on the CD. However, this isn't
transparent to the end user.
CRI-X3 enables programs like DoubleSpace to work on a CD. It's intended
for a publisher or for significant internal use, and the licensing is priced
accordingly. See http://www.cdrominc.com/. (Side note: the company filed
patent infringement suits against Traxdata and CeQuadrat in Sep 1998 for
distributing CD compression software. This might account for the dearth
of similar applications.)
A straightforward solution is to write all of the files onto the disc
as .ZIP files, and then use ZipMagic (formerly ZipFolders) to view the
contents. It can be found at http://www.ontrack.com/zipmagic/.
PGP at http://www.nai.com/ (was http://www.pgp.com) has some good
encryption software, but none of it seems directly applicable to software
distribution. PGPdisk, available for the Mac, might be useful but it isn't
clear whether it can be used to distribute CD-ROMs.
ScramDisk, from http://www.scramdisk.clara.net/, writes files into
encrypted "containers" on disk. It can be used with CD-ROMs, runs under
Win95 and Win98, is free, and even includes source code.
http://www.c-dilla.com/ had information on CD-Secure 2, which allowed
publishers to distribute network-licensed or "pay for the parts you
need" products, and CD-Compress 2, which provides a way to compress data
transparently on production CDs. The company is now part of Macrovision.
EnCrypt-CD encrypts the blocks as they are written to CD. It's a shareware
product, available from http://www.shareit.com/programs/102046.htm.
Encrypted Magic Folders from http://www.pc-magic.com/ claims to
transparently encrypt data as it's being used. Whether it would work from
a CD-ROM isn't stated.
http://cd-lock.com/ offers Blowfish encryption and scrambled filenames.
End users don't need to install software to decrypt the disks if they're
running Win2K or WinXP. (Appears to be related to pc-magic.com, above.)
You can install a cryptographic filesystem (called "CFS") under Linux; see
http://www.linuxdoc.org/HOWTO/Security-HOWTO-6.html#ss6.10. Create a
crypto-fs, copy your data onto it, then use mkisofs with Rock Ridge
extensions enabled to create an ISO-9660 disc image of the encrypted data.
Burn the image to CD-ROM.
You may be able to use E4M, from http://www.e4m.net.
BestCrypt, from http://www.jetico.com/, lets you create encrypted virtual
volumes in a file that can be stored on CD-R media.
You can get PC Guardian's CD-ROM encryption from http://www.pcguardian.com/.
WinDefender, available from http://www.RTSecurity.com/products/windefender,
provides transparent CD-ROM encryption from Windows.
Dynamic-CD can encrypt and password-protect CD-ROMs. See