d.code asks about securing connection strings. If you are willing to deal with a little unmanaged code, you can use the machine key or a user key via Data Protection API (DPAPI) functions instead of hiding your key somewhere. I first heard about the machine key at a Microsoft Security Summit that was touring around the country last spring. I based my work on this example, and a relevant MSDN article. The upside is that you do not need to maintain your own key somewhere, the downside is that any application run on the computer could decrypt your string, and that an encrypted string cannot be passed between computers (or users if you go that route), so you have to create the encrypted strings during deployment and have access to run an executeable on the production computer during deployment.
I created a small Winforms program that I run during deployment to encrypt my connection strings using the machine key. It just has two text boxes and two buttons for encrypting and decrypting strings. Once the deployment is done the exe is removed from the production machine. If someone compromised the box, they would have to know you used DPAPI (which they could only determine by spending the time to decompile your assembly) and have their own exe ready or create one to decrypt the strings. A little obfuscation on your code would contribute to the security in this situation.