One of the processes I run regularly is a batch file calling Apex Data Loader to export a number of objects from my Salesforce org. I use these files to populate a fresh backup of the Salesforce data, and when my password changed recently I needed to generate a new encrypted string to use in the proces-conf.xml file. However, even though the encryption process is fairly simple, the documentation provided isn't clear.
Open the cmd window and change the directory to point at the bin folder where your encrypt.bat file resides.
For more detailed information view the Data Loader documentation.