An optical encoder configuration comprises a cylindrical or planar rotary scale including yawed grating bars, an illumination source, a structured illumination generating arrangement (SIGA) and a detector arrangement including a photodetector. The SIGA is configured to input source light to a first illumination region on the rotary scale which diffracts light to a beam deflector configuration which transmits the diffracted light in a form that provides a particular fringe pattern proximate to a second illumination region on the scale. The scale filters and outputs that light to form a detector fringe pattern of intensity bands that are long along the rotary measuring direction and relatively narrow and periodic along a detected fringe motion direction (DFMD) transverse to the rotary measuring direction. The photodetector is configured to detect a position of the intensity bands as a function of rotary scale displacement and provide corresponding displacement or position signals.