I don't bother hiding anything, mostly because other people don't use my computer and if someone ever needs to borrow it for something, they won't have access to my files anyway. That and meh, I don't have much to hide really.
If I did want to hide something like that though, I'd probably scatter the data around into several separate password-protected and encrypted archives within another encrypted archive with each archive having a different password containing at least 8 characters (none of them containing words for someone to dictionary attack again) and there'd be several archives to act as dummies filled with useless data that takes up roughly the same space.
Next I'd place this in an encrypted volume using something like Truecrypt, making sure to use up additional space with junk data and to use a long password with as large a variety of characters as possible. Then this volume that contains the archive that contains all the archives would be placed in a hidden directory somewhere in the filesystem, the permissions would be set so that no user (except root, of course) would have read, write or execute permissions.l This would naturally be on one of my main partitions, and I tend use filesystems Windows (and Mac OS X) can't read for most of my data.
If I really wanted to make it secure though I'd then create a separate partition, use a filesystem that both supports encryption and isn't widely used, encrypt the filesystem with another completely different password that should prevent most cracking attempts. Finally, to jack up the security to truly paranoid levels I'd password protect both the bootloader and the BIOS (I'm aware of the downsides of using passwords in BIOS, but it still adds an extra layer of protection).
...oh and of course, the laptop itself would be hidden, preferably locked away when not in use