Much better way is to use integrated security. You just need a /E on the end then

If you have a job that runs multiple dts packages, the process you have documented would be long and laborious....

I generally use the DTSRUNUI.exe executable...

1) >start>Run>DTSRUNUI 
2) Specify SQL Server you want to get encrypted command for and the login credentials you want the job to use to run.
3) click the "..." next to package name
4) Click the "advanced" button
5) Specify variables if you want to...
6) Click the bullet for "Encrypt the command"
7) Click the "Generate" button
8) copy n' paste the line of text that is generated into the step of your dts package...

Wahlah, nice and easy... DTSRUNUI is seperate from enterprise manager, so you can have both apps up at the same time...

Thanks for the tip.

Can this encrypted command line be used as the Data Source on the Linked Server Properties sheet, (when implementing the Package as a linked server this is the equivalent of the dtsrun command-line). This is important to us as the Data Source is stored as open text in the database ???

I agree with the other posters regarding the use of the /E option.  The key to making this work is to remember the security context.  In the case mentioned here, the job will run as the user logged in to the SQL Server Agent.  If the DTS package utilizes resources across the network, it may be necessary to set up the SQL Server Agent account with a domain level account.

We run hundreds of DTS packages this way.  We tried running with the method mentioned here and found it to be a maintenance nightmare because you can't be sure which package is actually being run.