I've been using eldos SecureBlackBox with VFP for PGP encryption/decryption. This may not be of much use for you because there are more choices on the marketplace available for .NET than VFP. SecureBlackBox works, the documentation sucks, the cost is around $400. Available at http://www.eldos.com/sbb/. My application retrieves a public key via FTP, encrypts a file (credit card settlements), and transmits the file via FTP to the host. SecureBlackBox was the only software I found that I could integrate seamlessly into the installation of the application.

During development I had to makeup my own public keys and I used GnuPG4win 2.0.4 (shareware, free) that works quite nicely but not automated. Frankly, I'm not sure if SecureBlackBox would generate public keys since (1) I didn't have to try and (2) it was a PITA to get things working with their obtuse documentation and lack of support so (3) I didn't want to burn up any more time on a learning exercise.