I'm running 9.04 with encrypted HDD (it's a corporate laptop so needs to
be). I need to run VM quite often and this issue is causing me lots of
pain. Especially when copying / moving large files (2+ GB)

Renice tip above seems to cure some of the performance issue (i.e. CPU
usage goes back to normal levels) but it's far from ideal.

Looks like this bug has been around for a while and as encryption is a
must - especially in the corporate user base - I would suggest the
priority of this bug be upped (in agreement with bongey above)

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kcryptd process doesn't utilize multiple cpus
https://bugs.launchpad.net/bugs/246413
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