There is a bug in Fedora 10 when setting up encrypted filesystem which is pretty annoying if you have a non-US keyboard layout and use special characters as keyphrase:
See http://fedoraproject.org/wiki/Bugs/Common#Wrong_keyboard_layout_when_ent...

You can run

mkinitrd -f /boot/initrd-$(uname -r).img $(uname -r)

to rebuild the initrd image with the current settings.