Does Notational Velocity/nvALT securely sync with Simplenote?

I set nvALT to use a single database to store my notes. Using a database provides the benefit of encryption. I also sync my notes using Simplenote.

I just noticed this warning at the bottom of the synchronization settings window:

Note contents will be delivered in clear text.

This came as a bit of a shock because I have personal sensitive information stored in nvALT.

I searched for the syncing APIs of Simplenote which seem to use HTTPS but I'm not sure about that. Can anyone explain how the synchronization works exactly and what the warning message means?

The Notational Velocity FAQ appears contradictory:

How does encryption work in conjunction with Simplenote?

If database encryption is enabled under Preferences > Notes > Security, then your notes will be encrypted on disk. However, they will still be sent to Simplenote without encryption. (And obviously Notational Velocity will always use SSL regardless.)

It seems to say that the encrypted DB will be decrypted and then re-encrypted with SSL. So Simplenote will be able to see your notes after they receive and decrypt, but an eavesdropper would not.