Absolutely. If you are using block-level encryption within the guest, most (all?) such solutions will immediately encrypt the entire drive, including free space. This means that the .vmdk on the host will always be the size of the guest-visible HDD (plus some host-side .vmdk overhead, minus some unencryped overhead space on the guest disk).
I think you have very neatly found your own answer. 
Cheers,
--
Darius