ADAL13, if you can see the text WITHOUT changing the packet (ignoring the default L2 encryption) then it's not encrypted.
I haven't taken the time to study BakeIce at all, but from what I know, it's does an Auth procedure to let you login, perhaps requests and sends a new auth token, scans your computer for bad programs, and then patches the client Auth connection to let you communicate with the login server.
It'd be interesting to see TurkSauron's BakeIce code :P
Maybe one of these days I will examine BakeIce under a debugger when I have time ;) It would be an interesting adventure.