Hi, there are actually no Nigori specific things that need to be added server side for sync data encryption. Encryption and decryption are performed client side.
If you want to offer encryption, likely the easiest thing you could do from a technical perspective would be to require use of custom passphrases (see
PassphraseType in nigori_specifics.proto) and set encrypt_everything to true. This will mean all datatypes are encrypted with a key derived (using nigori) from a user specified secret, and you won't have to worry about things like key changes due to new user passwords. This will require overriding some sync setup UI though, as Chrome's default mode is not to encrypt all data.
We recently added
this key in chromiumsync.py (which I'm guessing is what you're referring to?). It is not yet used and will never be absolutely required for sync encryption to work -- it will not be used if the user opts to use a custom passphrase (and note that soon, the client will encrypt with a custom passphrase if-and-only-if encrypt_everything is also true).