Can you explain a bit on the implementation? Is this "just" a bitcoind frontend with bitcoind running on your server? Or is the concept similar to blockchain.info or strongcoin?
Ill try to explain this as best as i can, my brother was the one who did the encryption side.
To what he has explain me is, your password is the key to decode the file contains your information.
The main app is base on ruby running out of Heroku (at the moment test is running on amazon ec2 and volume drive), bitcoind is running on a cloud cluster made up of 10 ec2 instances lock down for security, theres a nightly backup to an intence that is only turn on when the backup request is issue and then its turn off.