Both attribute values and referenced, external data are similar from the element perspective in that they are both data associated with the element. The Transform proposal suggests using XSLT to convert attributes into elements and then encrypt according to rules presently in the XML Encryption proposal. Could perhaps also handle external data using extension functions. Develop either the EncryptedDataManifest proposal or the Transform proposal. Develop both the EncryptedDataManifest proposal or the Transform proposal.
Applications can use whichever mechanism is best for their needs.
At this point, probably best to just get more feedback.