I can report the same problem (error message: "Cannot allocate memory") when 
using the method outlined in 
https://help.ubuntu.com/community/EncryptedPrivateDirectory 

# Move the application's data directory (e.g. ~/.mozilla or
~/.evolution) into your ~/Private directory

 mv ~/.evolution ~/Private

-- 
Error when copying directory tree with Nautilus to ~/Private using ecryptfs
https://bugs.launchpad.net/bugs/292429
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Status in “ecryptfs-utils” source package in Ubuntu: New

Bug description:
Binary package hint: ecryptfs-utils

I set up ecryptfs following the instructions in the community documentation:

$ sudo apt-get install ecryptfs-utils
$ ecryptfs-setup-private

Logged out and logged back in.  I see the "Private" drive icon on the desktop.

If I copy single files into the Private drive in Nautilus, it seems to work.  
However, if I select a directory tree to copy in Nautilus by hilighting a 
directory, pressing control-C and then clicking on Private and pressing 
control-V to paste, I get an error message for every file in the directory tree 
that I was trying to copy:

Error while copying "guide.pdf".

There was an error copying the file into /home/me/Private/foo/benefits.

Show more details:
Error opening file '/home/me/Private/foo/benefits/guide.pdf': Cannot allocate 
memory

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