Yes Dropbox encrypts your data. It even says so on the Dropbox page you linked to :-)
https://www.theregister.co.uk/2011/05/16/dropbox_ftc_not_goo...
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.