Currently, rdesktop is encrypting its communication with md5, with an unsecure key exchange using RSA public key encryption. Since W2003SP1, there is a possibility to use TLS instead. http://blogs.technet.com/tristank/archive/2005/02/24/379380.aspx has some details while http://technet2.microsoft.com/windowsserver/en/library/a92d8eb9-f53d-4e86-ac9b-29fd6146977b1033.mspx?mfr=true documents the setup, which includes certficate authority configuration.
*** This bug has been marked as a duplicate of bug 4347 ***