Are Apple Remote Desktop connections encrypted

You are correct, VNC is a simpler version of Remote Desktop (note: Remote Desktop uses the VNC protocol in addition to adding a lot more features)

Remote Desktop offers more management features; ability to black out host computers screen, push updates, file transfers etc (think TeamViewer but by Apple). http://www.apple.com/remotedesktop/

VNC doesnt have any of these options, its just a simple way to access a remote screen.

Remote Login allows you to SSH to a remote computer (command line - you dont see the remote desktop)

eg You may want to run a command on a remote computer, you could connect using VNC and open terminal or instead you could remote login via SSH and run the command without actually interacting with the screen of the remote computer

Updated to include @Wheat Williams notes below

ARD into your "work account" and then do the following on the remote computer to open a Screen Sharing window to your "personal account" on the same remote computer.

Create an SSH tunnel. It works for me using 10.9.

Enable Remote Login (SSH) in System Preferences > Sharing, and in Terminal run:

ssh -NL 5901:localhost:5900 localhost

Finally, use Screen Sharing to connect to localhost:5901 (instead of the default port 5900). Instead of port 5901 you can use a much higher port that isn't in use by anything else.

The Screen Sharing application is located here: /System/Library/CoreServices/Screen Sharing.app