Why is the IV passed in the clear when it can be easily encrypted?
Depending on the mode of operation, transmitting the IV encrypted (with the same key as used for the rest of the process) can actually weaken security a lot.

For example, in the CFB and OFB modes, the IV is encrypted and the result XORed with the first block of the plaintext to produce the first block of ciphertext.  Thus, an adversary who knows the encrypted IV can trivially undo the XOR to recover the first block of plaintext!  The same is true for the CTR mode, if the IV/nonce is used directly as the initial counter value.

The CBC mode works differently, and does not break as catastrophically if you encrypt the IV before transmitting it.  However, as Henrick Hellström has pointed out, knowing the encrypted IV still lets an adversary figure out whether the first block of the plaintext consists of all zeros.