Hello tinman,
AxCrypt app settings will differ from the systems/machines, not based on the AxCrypt account. You can locate the folder by navigating to the path C:\Users\’your system username’\AppData\Local\AxCrypt.
For the first question: Yes, you have to close the opened files and its corresponding applications in both the machines(based on the opened files – may be only in machine 1 or machine 2 or both machines). Then only AxCrypt can re-encrypt the files.
For example: If you modify the contents in machine1 with the AxCrypt app, you have to close the opened file with its corresponding opened application in machine1 to re-encrypt the opened file.
For the second question: As I said earlier, AxCrypt app settings will differ from the systems. So AxCrypt app will not get confused when you duplicate the secured folder list on both machines.