I think that the biggest concern is that Dropbox has access to your files. The files might be encrypted from the point of view of the physical location, but the

I think that the biggest concern is that Dropbox has access to your files. The files might be encrypted from the point of view of the physical location, but they are still accessible to Dropbox employees, feds, or anyone that manages to breach their servers. The most common solution to this is to use TrueCrypt containers for any particularly sensitive files.