Good point. What, more specifically, is the purpose of the Citrix encoding system? Is it to map an arbitrary byte string onto a limited range of bytes (ASCII A to P)? If so, any reason base 64 was unsuitable for these applications?
Using only the uppercase letters lets them worry less about whether the string got mangled because some systems interpreted it as Unicode and some didn't etc.
Something like Bitcoin and Flickr's base58 would have also worked, but the encoder and decoder would have been more complicated. They got away with only division by 16.
They get a little bit of integrity checking too.
Basically, this is base16 with a poor man's integrity checking baked in. Pretty interesting.
Knowing that, it does in fact seem like a sensible encoding for certain applications. Encoding, not encryption, mind you. I assume (or at least hope) the designers intended it as the former only, and never as the latter.