The current newt version (newt-0.52.7-4.fc8 package) seems not to handle utf8 characters correctly. It seems that slang is not switched to utf-8 mode in newts code. Newt should call SLutf8_enable(-1), see http://www.s-lang.org/doc/html/cslang-4.html Have a look at the Novell bugzilla for reference. Adding the attached patch fixes the problem.
Created attachment 289784 [details] Patch setting SLutf8_enable(-1); in newt
Will be fixed in the next newt release. Fedora slang package has a patch calling SLutf8_enable, so applications that don't call the function work correctly in utf8. Maybe it's time to drop the patch. Thanks for the report.
Thanks for including this patch in the next release. BTW: me is hoping for a release of newt on hosted.fedoraproject.org (#226195) - would make monitoring much easier... ;-)
Fixed in newt-0.52.8.
Upstream tarballs are at https://fedorahosted.org/releases/n/e/newt/.