Data Encryption

Dear All,

I would like to know how data encryption works. I have encrypted my laptop with DiskCryptor. I would like to know:

1. the difference between data encryption and setting a system password on boot up.

2. If someone were to gain access to my laptop and copy a file from my laptop onto his/her computer, then I would like to know whether that file would be encrypted or not ? Would he be able to read the file ??? If yes, then what is the use of data encryption ??? How does this work ???

Can someone please explain this to me ???

Thanks a lot.

~Maneesh