I'm thinking of protecting my script to the mass majority of users (non-web dev savvy) and I came across an online service to encode php script. I'm not sure about it though.
Is it safe to encrypt php script? What if the encoded code has something fishy in it?
If you intend to distribute the PHP file then I would suggest that you do not do this. It's only going to irritate those that want to tinker with it.
If for some reason you don't want them tinkering with it, then don't distribute the PHP file.
If you need to distribute the file AND you don't want them tinkering with it, then I would highly suggest you not do this in PHP and instead write the functionality using C as an extension to PHP.
You'll notice that at no point do I suggest you actually go ahead and "encode" the php file. That's not going to buy you anything.