Yes, I personally used to use this, and am very satisfied with it. I actually used it together with Iono from Olate (for remote license management), but that was because I was selling software - it's not really practical to use Iono when you are just selling a script with a site.
I've created a small example just to show you how it looks (I still own a license and have it installed). I've attached both the unencrypted and encryted files.
That is a good idea actually.I dont know what the code does but why not create an API for it and host the code on your server and call it from the site you are selling using the API
Encrypt it with Ioncube. If you don't want to buy the entire software package, you can buy individual credits and use their online encoder.