The 160 GB hard disk was about 40% full before I started. It took 1.5 hours to encrypt my 41 GB home directory, followed by 3.5 hours to securely erase the old unencrypted version.
The performance afterwards seems to be generally the same before. The only exception I've hit so far is with Parallels resizing an expanding disk in a virtual machine, and there the performance is terrible. This makes some kind of sense: There are two disk images being expanded, the Parallels VM disk inside the encrypted home directory, and then the encrypted disk image containing the home directory. Pre-allocating the disk image for the VM helps, because it means no resizing is required at run-time.
Some of my preferences seem to have been lost. I had to make Firefox my default browser again. And I had a hot corner to turn on the sceensaver, which mysteriously stopped working -- I fixed that by setting a different corner to do "show desktop", after which the screensaver hot corner worked again (strange).