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Part 2 Fact 1: This is actual *trying* and this is what resulted. HOWEVER, what I apparently started with was a file that was created with V1 BEFORE KeepTimeStamp=1 was set. Then as I went through the procedures of opening, editing, closing, open editing, closing the report was as I stated and my conclusion was based on that.
However, before any more panties get ruffled, I now did an additional test where instead of operating on a previously encrypted file where KeepTimeStamp=0, I created a NEW file this time while KeepTimeStamp=1 set. And the results differ from the other test in that the Encryption date REMAINS as FIRST encrypted as you said regardless of the number of modifications (reflected in the inside file ONLY). I believe #2 is the scenario you are describing.
1. If the file was originally encrypted with KeepTimeStamp=0, and then the test operations are done, the results are as I stated. *try* it.
2. If a NEW file created while KeepTimeStamp=1, then the same operations are done against this file the result as you stated.
Since a lot of my old files are like #1 and some are like #2, I now have a mixture which now render my file management using KeepTimeStamp=1 use bogus. It took a while to discover this despite actually *trying* them using the software. I hope you can see the confusion since I was always testing #1 files above (15+ years worth at least) and just now did #2.
We can now end the discussion. I now understand enough nuances and have to rethink what to do with the files and timestamps I have. Thanks for the direction that got me to these last *results* and conclusions.