PHPNuke is a multilanguage websit-builder package writed in php too, and its multibyte character languages work fine. It's language package files use the function define("...","...") rather than $string('...')="..." in Moodle. In functional php files, PHPNuke calls the defined strings directly, eg echo "something"._DEFINEDSTRING."another strings".........
Can Moodle try this method?