Mount on filesystem of type eCryptfs explicitly disallowed due to known incompatibilities

You mentioned that your home folder is "encrypted by Ubuntu" -- it's actually encrypted using eCryptfs. Check the output of:

grep $HOME /proc/mounts

Nesting encrypted directories inside of encrypted directories is not supported with eCryptfs. Sorry.

Full disclosure: I'm one of the authors and current maintainers of eCryptfs.