The XML | Add Child | Encoded External File command is available in Grid View only. It adds a binary encoded file as a child node. The encoded external file is inserted as a child of the Grid View selection.
On clicking the command, the Insert Encoded External File dialog (screenshot below) pops up. In it you enter the path to the file, select the encoding you want, and specify whether the encoded file is to be inserted in an element or not.
On clicking OK, the encoded text of the selected file is inserted at the cursor location, with an enclosing element if this has been specified.
The encoded file is added as a child in Grid View.