X10 (and other power line communications) signals can travel back up to the transformer, and they can interfere with other systems which are connected to that same transformer. You can purchase a "signal blocker" to prevent the signal from making it back up the line, but these will typically need to be installed in the breaker panel (which may or may not be DIY for you).
In general, most new home automation products use wireless transmission protocols. There are several standards out there, but the main players are Insteon, Z-Wave, and Zigbee. More or less, these options are very similar. They are low power RF protocols, centered around a "mesh network" scheme. All nodes can transmit and receive commands, and signals can be re-broadcast to other nodes which may be out of range of the original signal.
Insteon - This is a proprietary protocol, designed to address the shortcomings of X-10 Basically a hybrid between X-10 and a full wireless solution. Signals are broadcast wirelessly, and also over the power line. There is support in the protocol for data encryption, but in general it is not supported by the hardware. Without the encryption, commands can be intercepted and spoofed by an attacker. You also have the same powerline problems that are present in X-10.
Z-Wave - This is also a proprietary protocol, but is completely wireless. There is no encryption of the transmitted data.
Zigbee - This is a standards based (IEEE 802.15.4-2003) wireless protocol. It uses an encrypted communications channel to communicate between nodes (AES 128 bit). Generally speaking, this is the most secure of the 3.
All of these protocols are relatively widespread, with several companies producing controllers and modules which support one (or more) of them.
Given that you seem to be concerned about the security of your automation system, I would likely choose either a Zigbee system or an X-10 system with a signal blocker installed. The X-10 system will likely be cheaper, but depending on the hardware you purchase and your specific electrical setup, the system may or may not be completely reliable.