yeah, the traffic is encrypted. Hyper-V Replica transmits directly over the WAN to an external IP Address, it's using SSL for authentication, but then recycles those certificates to encrypt and protect the traffic on transport. sigh.
we're waiting on two evaluation RiverBed Steelhead appliances (will be for over a month I'm told), but thus far I've been woefully unimpressed with their attitude towards smaller business that isn't looking to spend 80 grand on overkill hardware.
will be keeping an eye on you guys, if you ever get HTTPS decryption / optimization added I'd love to see it in action. And check out the Hyper-V Replica space, if there's any other easy way to integrate it with the Hyper-V hosts, we are seeing a lot more smaller SMB's moving to Hyper-V and using Replica as a super cost effective way of building out Disaster Operations plans.
great job though, love the product.