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But encrypted in a way where Dropbox employees still have unencrypted access to your files, at least according to Christopher Soghoian back in 2011:

https://www.theregister.co.uk/2011/05/16/dropbox_ftc_not_goo...

That’s a different claim and one with severe tradeoffs for the other option: you can regain access to your Dropbox after losing your password.

Since you’re running their software, you’re ultimately trusting their policies anyway. Even if they had encryption at rest it wouldn’t tell you that it’s correctly implemented and doesn’t e.g. leak keys.

They encrypt in transit, but not data at rest by the looks of things. At least I don't get that impression.

They do - but they hold all keys themselves.