A friend who looked into this in the past (Quicken 2003 or 2004 days) claimed that the file was actually encrypted. However, I have not confirmed that. You may well be able to find out somewhere on Intuit's web site - I know that in the past they had some fairly advanced info about the data format, and it seems like this is the sort of detail that would likely also be there somewhere.
Having said that, I put my Quicken data file in an encrypted disk image before putting it on my iDisk. I tend to trust the encryption in encrypted disk images more than Intuit's simply because I have no details on what kind of encryption they use.
-andrew