An encapsulation scheme that prevents interaction of the siRNA with cell-surface receptors could eliminate some side effects. However, the off-target modulation of gene expression characteristic of small dsRNA will still occur.
Here are some citations addressing this off-target gene modulation.
Comparison of siRNA-induced off-target RNA and protein effects. Aleman LM, Doench J, Sharp PA. RNA. 2007 Jan 19; [Epub ahead of print]
Retraction of synapses and dendritic spines induced by off-target effects of RNA interference. Alvarez VA, Ridenour DA, Sabatini BL. J Neurosci. 2006 Jul 26;26(30):7820-5.
3' UTR seed matches, but not overall identity, are associated with RNAi off-targets. Birmingham A, Anderson EM, Reynolds A, Ilsley-Tyree D, Leake D, Fedorov Y, Baskerville S, Maksimova E, Robinson K, Karpilow J, Marshall WS, Khvorova A. Nat Methods. 2006 Mar;3(3):199-204.
Nonspecific, concentration-dependant stimulation and repression of mammalian gene expression by small interfering RNAs (siRNAs). Persengiev SP, Zhu X and Green M. RNA 2004; 10:12-18.
Transcriptional gene silencing by short interfering RNAs. Kawasaki H, Taira K. Curr Opin Molec Therap. 2005 7(2):125-31.
Small interfering RNA-induced transcriptional gene silencing in human cells. Morris KV, Chan SWL, Jacobson SE, Looney DJ. Science 305(5688):1289-92.
A rapid and sensitive assay for quantification of siRNA efficiency and specificity. Smart N, Scambler PJ, Riley PR
. Biol Proced Online. 2005;7:1-7. Epub 2005 Jan 24.
Short interfering RNAs can induce unexpected and divergent changes in the levels of untargeted proteins in mammalian cells. Scacheri PC, Rozenblatt-Rosen O, Caplen NJ, Wolfsberg TG, Umayam L, Lee JC, Hughes CM, Shanmugam KS, Bhattacharjee A, Meyerson M, Collins FS. Proc Natl Acad Sci U S A. 2004 Feb 17;101(7):1892-7. Epub 2004 Feb 09.
Expression profiling reveals off-target gene regulation by RNAi. Jackson AL, Bartz SR, Schelter J, Kobayashi SV, Burchard J, Mao M, Li B, Cavet G, Linsley PS. Nat Biotechnol. 2003 Jun;21(6):635-637.
Small RNAs with Imperfect Match to Endogenous mRNA Repress Translation: Implications for off-target activity of small inhibitory RNA in mammalian cells. Saxena S, Jonsson ZO, Dutta A. J Biol Chem. 2003 Nov 7;278(45):44312-44319.