The "Community" folder is not encrypted. In no MSFS version. Not in the Store version, not in the DVD version and also not in the Steam version.
The "Community" folder is always freely available/accessible for any add-ons. That's why it is called "Community" folder btw.
Stuff you purchase from the MSFS marketplace goes into the "Official\OneStore" folder, and that stuff is getting encrypted. This is the DRM (digital rights management) system of Microsoft. But this only applies to the content of the "Official\OneStore" folder, but not to the content of the "Community" folder.
The above is true for every MSFS version and is also totally independent from the location (partition) you install your MSFS to.
MSFS expects add-ons in either the "Community" folder or the "Official\OneStore" folder. Installers which offer you to select the "Installation folder" just don't want to go through the trouble of identifying the location of the "Community" folder on your system but leave it to you to know it. The locations actually differ between the Store/DVD version and the Steam version, and can also get manually manipulated, which makes it tricky for an installer to figure the correct location. But in the end this is not rocket science. Some developers just play it easy and leave the responsibility on the customers shoulder (where it doesn't necessarily belong).
If you installed your MSFS to a location other than the default one, MSFS still expects all files at their default/original location. It only knows that location. When installing MSFS somewhere else (or moving it after initial installation via the Windows settings) you will get symbolic links at the original location pointing to the new one. So who ever wants to access MSFS files (either MSFS itself or an add-on installer) just access the file through the default/orignal path and the symbolic links will make sure the files will be found at the real physical location on your system.
This so far has nothing to do with the "MSFS Addons Linker" (that comes later) and is true for EVERY "Microsoft Store" application on your system.
The "MSFS Addons Linker" gives you the chance to move add-ons out from the "Community" folder (regardless if it is still at the default location or you moved it somewhere else) and leave symbolic links there instead so that MSFS will find it.
Lets assume you have installed your MSFS on D. You still have the original MSFS folder structure on C. If MSFS wants to read some of your add-on files it accesses them at the original/default location. The symbolic links there (which have been created when you installed or moved your MSFS to D) will bring it to your D drive. Now lets assume you have all your add-ons moved out from the "Community" on drive D to your drive E and use the "MSFS Addons Linker". When MSFS ends up in the first step on your drive D when trying to access an add-on, the symbolic link there created by the "MSFS Addons Linker" will again redirect it to the final and real physical location on drive E.
This is how symbolic links work.
But again, in no MSFS version the "Community" folder is encrypted and you are forced to install add-ons somewhere else to escape that kind of encryption. Nothing like that exists.
Add-ons must be installed into the original MSFS "Community" folder. This is by default on drive C (complete path is somewhere above in this topic) and MSFS will only access this very folder. Installing/moving it somewhere else is totally transparent to MSFS.
There is however the possibility that you explicitly tell MSFS that your "Packages" folder (in which the "Community" and "Official\OneStore" folders are located) is not at the above stated default/original location but somewhere else. In this case you have to manually modify the "UserCfg.opt" file and that's why asked if you have modified it in one of my previous replies.
The latter way through the "UserCfg.opt" file is an MSFS build-in way to specify the location of your "Community" folder on your system (regardless where it is). The other way of installing/moving MSFS is through Windows functionality which will create the above explained symbolic links for you.
A user can chose either way. Usually one choses the way via the Windows settings as it is more obvious and more easy to handle (as it doesn't expects any deeper knowledge of the file system from the user).
Coming back to the CRJ: it simply is not necessary for the CRJ setup to allow the user to specify an installation folder. The setup is clever enough to detect the one that needed to be used (regardless of which of the two above explained ways you have used to move the "Community" folder).
And again, there is no such thing as an encrypted "Community" folder.
Who ever explained things differently to you and even told you that this is a "common" issue simply didn't knew what he/she was talking about.
I am not saying that everything I explained above is easy to understand and easy to figure when having to deal with it for the first time. And nobody is to blame for having trouble understanding it. But that's the way "Microsoft Store" apps and the MSFS as such work on a file/folder level.