After you had finally master your the utf8 convert of you Typ3 installation may encounter an other problem. Your own extension is not producing utf8 output.
Your first idea will be to add "SET NAMES UTF8;" to you database connection when using the DBAL of Typo3. But this is not your problem 😉 $GLOBALS['TYPO3_DB']->exec_SELECTquery (which is actually using the DBAL) gives your right want you want!

After a while you’ll may find out that you’ve used for some reasons htmlentities. And this is your problem! But don’t panic. You just need to added some more parameters and the world will be fine again. Just add ‚UTF-8‘ as third parameter to give the function a hint that you are using uft8. Tricky … isn’t it 😉

So it will look similar like this:
$str = htmlentities( $dbData, ENT_COMPAT, 'UTF-8' );

Building a multi language site can be very hard. First of all you need be sure that you are running Typo3 and your database with the correct encoding. UTF-8 is your friend! Apply all the setting you need for you installation (have a look at http://wiki.typo3.org/index.php/UTF-8_support will may help you) and also ensure your database is using UTF-8. (BTW: If you database tables are using UFT-8 you do NOT need to set $TYPO3_CONF_VARS[‚SYS‘][‚multiplyDBfieldSize‘] and do not forget to run database->compare of the installation tool)

Now your Typo3 installation is working fine. Really? Have you checked your own extensions? Ups! There is may a problem if you use getLL and locallang.xml. Some chars are may mess up even if the locallang.xml looks fine (of course you are using an UTF-8 enabled editor and you are saving this file as UTF-8).

The problem is the „default“ languageKey setting. You are not allowed to use any encoding then ansi. But what if you need some special chars there? Be sure you set an other default key (for example „config.language = en“ will do this job for english) and rename „default“ to „en“. Now you are fine!