To use a USB flash drive for holding encrypted files, the drive must have sufficient storage capacity and be formatted to support the file system needed for encryption. Additionally, encryption software is necessary to securely encrypt the files before saving them onto the drive. It's also important to ensure that the encryption method used is strong enough to protect the data from unauthorized access. Finally, a secure password or key management system should be in place to access the encrypted files.
They are automatically encrypted
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VHD stands for Virtual Hard Drive. It is utilized on Microsoft computers in order to create a separate area to drive to store files that may be encrypted.
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Encrypted files can only be accessed by authorized computer users who have the decryption key. Encryption is a popular technique in Information Security.
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http://en.wikipedia.org/wiki/Encrypting_File_System
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Often DVD files are encrypted and you cannot simply copy and paste files from them. Otherwise, it may be a faulty DVD drive that is keeping you from getting this file from the DVD.
From the file's Properties dialog box ,click the Advanced button. In the Advanced Attributes dialog box, uncheck Encrypt contents to secure data