I am glad you like AxCrypt. Implementing Icon Overlays as the technique is called is unfortunately a bit tricky, and also it works so-so. I’ve seen many implementations by very good developers, and it just doesn’t work that well. It’s also quite complicated for us, since we’re actually changing the extension of the files. I.e. – we need to retrieve the originally associated icon, then produce the overlay version, and finally supply Windows with it.
In version 2, we might do this kind of thing inside the desktop application, while not doing it in the Windows Explorer extension.