Comment 8 for bug 2043301

After much trial and error, I have a workaround.

When you first boot the ISO, before beginning the installation, open QTerminal, and edit /etc/calamares/modules/before_bootloader_context.conf so that it has these contents underneath the comments:

    ---
    firmwareType:
        bios:
            - command: bash -c "echo \"GRUB_ENABLE_CRYPTODISK=y\" > /etc/default/grub.d/lubuntu-enable-crypto.cfg"
                 timeout: 10
        "*":
            ...<a bunch of apt and sed related stuff goes here>...
            - command: bash -c "echo \"GRUB_ENABLE_CRYPTODISK=y\" > /etc/default/grub.d/lubuntu-enable-crypto.cfg"
                 timeout: 10

(obviously the ...<a bunch of apt and sed related stuff goes here>... is a placeholder, you'll put the last two lines at the very bottom of that section)

Save the file, then run an encrypted installation. It should install successfully and you should be able to boot into the installed system and get a graphical environment.