I've been using TrueCrypt and I'm very happy with it. It's probably less secure than the PGP's solution, but my main concern is not really hackers, but some thief stealing my notebook and getting access to my scanned documents, Quicken files and so on.

An answer to the "please enter your password" problem might be a fake shell there for the sake of pleasing stupid customs officials.

Another solution is to use a TrueCrypt hidden volume:

http://www.truecrypt.org/hiddenvolume.php

I think Bruce Schneier would take issue with the idea of assuming attackers are stupid.