[nearby] Update encryption methods according to the spec

Test: -m
Fix: 290294425
Ignore-AOSP-First: nearby_not_in_aosp_yet
(cherry picked from https://googleplex-android-review.googlesource.com/q/commit:297c193dede82ca662a708bb7f3eeb90ce9e968b)
Merged-In: I24ead1adfd0928a877fa1441501c3b6e462bdbd6
Change-Id: I24ead1adfd0928a877fa1441501c3b6e462bdbd6