Hey,
there are a few things you need to be aware of.
1) The "Membership" class details with users and authentication.
2) The "FormsAuthentication" class deals with remembering an authenticated used between different pages. It does with by writing a value into the users cookie, this value is a secure ticket. To allow it to be secure, it is encrypted (going back to the line you high lighted).
3) The "FormsAuthenticationTicket" class produces the ticket used by the previous class to store in the cookie. You do not really need to play with this class yourself, as the FormsAuthentication class handles it all for you (if you want it to .. example below)
Below is some useful advice i posted to the ASP.NET usenet board.
The FormAuthentication class is the one that creates the encrypted ticket in
the cookie. Thus the following checks to see if a user is valid, if so it
"logs" them in by providing the secure cookie
1 if(Membership.ValidateUser("test", "test123"))
2 {
3 Forms.SetAuthCookie("test");
4 }
5
Finally, a user can be checked to be logged in on any page by
"User.Identity.IsAuthentication".
The following classes will be of use to anyone making there own
authentication systems on the back of the security model provided by ASP.NET
2.0
Membership
FormsAuthentication
FormsAuthenticationTicket