Maybe someone can answer these questions quickly without having to dig through the Milestone and Eris forums:
1) Is the Eris bootloader encrypted?
No. You can root the Eris, but there isn't a huge modding community built around it either, like there is around the Droid 1 or the Galaxy.
In general, rootability has been one of the nicer things about HTC phones (the Incredible has already been rooted too).
2) Are people still working relentlessly on getting bootloader access/flashing roms to the Milestone or have people just given up?
I don't know, but as newer phones come out, the hackers that have fun playing with these things will move on to the latest, greatest hardware. And after months of baning their heads against the wall, I bet most of them are having a lot more fun writing software for the rooted phones (for instance, Unrevoked has been teasing some stuff about what they're doing for the Incredible).
3) Is there any other possible way to flash custom roms if the bootloader is encrypted?
Sure, if you or someone else infiltrates Motorola headquarters and steals the bootloader's RSA key Mission Impossible-style.
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