I have finally bitten the bullet and ordered a couple of XBee Pros for use with the Quad. This is the 50mW nominal 1.6km range version operating at 2.4GHz for licencing in Australia. The concern with wireless in Scientific band is that it is already crowded with Wifi, Bluetooth and Microwave oven. Apparently the frequency hopping Xbee has pretty good noise rejection and can sustain decent data rates. The data rates are not very high, best suited for byte command line streaming than video. The low data rate also allows advanced techniques to be applied cheaply such as AES-128 encryption. Even the ARM CPU can do this in realtime.
Encrypting high data rate-streams such as videos requires a lot more computing power, and Intel is only just now breaking into the scene with processors capable of pervasive encryption during the network latency periods. You would expect military hardware to have permanent encryption, but they deploy these in the field expecting ignorance from the opponents and inability to decrypt weakly encrypted streams. The UAV Video hacks point to the fact that the military development contains unrealistic assumptions about the abilities of the opponents and serious corner-cutting.
So no non-encryped video streams. I think we will even encrypt the still the platform captures and saves on SD.