[Edit] - Clearly something is off here. iPhone keeps a copy of the last several hundred emails downloaded from my IMAP server, I would expect an iCloud backup of those emails would be "under the protection of the passcode" (a.k.a encrypted).

That doesn't mean Apple is somehow encrypting the messages stored on my IMAP server. Likewise, it doesn't mean Apple is encrypting customer emails stored on their @iCloud.com (or whatever) email servers....

I'm going to assume there are just some wires crossed here, but I do hope they clean up the document and clarify this.