+++ This bug was initially created as a clone of Bug #624379 +++ I find one piece of code which was still sending not encoded data through xmlrpc.
Commited as 83919154193c92fe8f0ecdd0cd4bdccfd448e850
Moving ON_QA. Please use Spacewalk 1.2 release cnadidate yum repo at http://koji.spacewalkproject.org/spacewalk/split/spacewalk-5E/client/spacewalk-5E-1.2/i386/os/ (or similar location for different arch or OS) to verify this bugzilla.
With Spacewalk 1.2 released, marking as CLOSED CURRENTRELEASE. https://www.redhat.com/archives/spacewalk-list/2010-November/msg00111.html