One specific problem is dictionaries will stop working correctly if you set the default encoding to anything but ASCII.
...except they haven't.
In your application. Can you please agree that this a semantical problem that is completely unacceptable for language design?
Indeed, but this doesn't happen because the app never has a situation where strings and unicodes are put in the same dict. However, it does have plenty of situations where lists containing a mixture of utf-8 encoded strings and unicodes exist, where changing the default encoding removes a *lot* of pain.
So you should convert all byte strings to UTF-8 before adding them to the list. Assuming you have used proper encapsulation and object-oriented design, it shouldn't be too difficult to find, for each such list, where the places are that modify the list.
Would anyone object if I added this snippet to the .rst that generates: http://docs.python.org/library/sys.html
The snippet explaining the problem? I don't mind, but Raymond is on record for objecting to any addition of a warning box to the documentation, because it gives the impression that Python is full of problems, when many these warnings really refer to boundary cases only.