Dll Security

Hi, i have a dll and i want to encrypt it to hide (obfuscate ??) an
important algorithm used here.

Well today i'm using a following approach:

I'm encrypting the dll with a program, then when i want to loadlibrary() it=
,
i decrypt it to a plain-text file, then i loadlibrary the plain-text file.
So i have my encrypted dll and i have a plain-text version either. To
mitigate this vulnerability, i'm using EFS to protect my plain-text dll.

I'm wondering if using the PE format i can do some kind of "on-the-fly
encrypt and decrypt". Is it possible ? There is any example ? Is it a good
solution ?

Thanks in advance,

Victor