@scottjenson Thanks for asking! I'm a big fan of Encrypting All The Things, but my impression here is that the dangers of PMs on Mastodon have more to do with the potentially confusing UX, so I think addressing the UX issues would help the most in the short term.
Ultimately, I want users to be able to assume "private" means encrypted, so I'm very glad that's part of the plan. Yes, people can use Signal, but there's still a need to privately transmit one's Signal username at a minimum. Also, private threads can stem from public threads, so it's natural to have some facility for privacy here. Finally, I'm a huge Signal fan, but its centralization means a single point of failure, and makes it a huge target for authoritarian state actors, and I worry about it going down or being compromised.
I would like to see more visual distinction between public and private posts, like different coloring, so fewer people confuse them.