Encryption

I need help getting started researching encryption. I need to take a user's password and save it to the data encrypted (Oracle9i).
1. Does the encryption happen in the servlet or at the database?
2. I know what SSL stands for, but how do you use it to encrypt data?
3. When I do a search, I get a lot of results back about MD5, but I then I also see people saying NO to MD5.
Any help is appreciated!
Lisa

Here are some code samples: click
And here is a tutorial: click
Security is a rather large topic. And even trying to provide a short description of SSL is a bit much. If you want to know about SSL start by reading about PKI (public key encryption).