I've worked with a freelancer industrial designer. He got referred to me by a Rapid Prototyping Company. So I know he's top notch and knows the in and outs of manufacturing.
As far as I know, they don't sign NDAs. Because their next client may have a product/design similar to one he did for another client/project. That puts him in a sticky situation.
So they don't sign NDAs for this reason. But they do keep your business/product in confidence. If word gets around they're passing designs to other people, he'll be out of work/clients... and get sued.
But wow. $20 per hour... sounds more like a CAD draftsman. I paid $75/hr.
Things to look out for... References. Good communication skills. Talk to him and see if he understands your requirement or "gets it". See if he can talk/explain things to you, explain technical things in a level you can understand. (I'm very technical in other areas, but he explained things to me that I do not understand in his area.)
Make clear on the rates. Are you paying him per hour, or a fixed fee for a deliverable.
Some I.D. have strong working relationships with other companies and they can manage your product from design to a working prototype (for an extra fee, retainer fee, etc). You don't have to deal with the factory/manufacturer, he talks to them at their technical level, and he talks to you at the business level.
A good ID will also give/offer you suggestions on how to make your product easier and cheaper to manufacture, and if there are cost implications for doing it one way vs. another way.
A good ID will ask MANY questions from you. Details matter. Things you didn't even think of, will matter much to him. This is where good communication skills come in. If your ID isn't doing this, and you just had a short chat with him and he's ready to go... hmmm, he may come out with a product that is not exactly what you envisioned.