According to these instructions there should be a "Convert to file encryption" option in Developer settings, but it's not there on my Nexus 6 running stock N Preview 1. When I try to search for it in the Settings app, it does show up:
Unfortunately, tapping on it simply brings me right back to Developer settings where that option is not found.
The alternative instruction is to reboot to bootloader and issue the fastboot --wipe-and-use-fbe command, but it fails with "fastboot: unknown option -- wipe-and-use-fbe" error. I am running the SDK Tools version 25.1.1 rc1, and Platform-tools version 24 rc1 from the preview channel of Android SDK, with latest fastboot utility (version 102d0d1e73de-android).
I performed a complete wipe (system and userdata), and flashed all the NPC56P images manually (bootloader, radio, recovery, system, cache, userdata.) The phone is encrypted, Screen lock is set to "PIN", and Secure start-up (requiring PIN before boot) is enabled.
Is this feature simply not available in Preview 1 and/or Nexus 6? How can I enable it?