michal@bobik app $./manage.py test
Creating test database...
>>>>> cursor.fetchone(): ('UNICODE',)
>>>>> encoding: utf-8
Got an error creating the test database: ERROR:  database "test_gr4unicode" already exists

CREATE DATABASE "test_gr4unicode"
It appears the test database, test_gr4unicode, already exists. Type 'yes' to delete it, or 'no' to cancel: yes
Destroying old test database...
Creating test database...
>>>>> cursor.fetchone(): (u'SQL_ASCII',)
>>>>> encoding: ascii
>>>>> cursor.fetchone(): (u'SQL_ASCII',)
>>>>> encoding: ascii
Creating table auth_message
Creating table auth_group
Creating table auth_user
Creating table auth_permission
Creating table django_content_type
Creating table django_session
Creating table django_site
Creating table django_admin_log
Creating table staticpages_staticpage
Creating table news_subscriber
Creating table news_new
Creating table news_tag
Creating table partners_partneruser
Creating table parameters_parameter
Creating table pressreleases_pressrelease

[...] several messages:
>>>>> cursor.fetchone(): (u'SQL_ASCII',)
>>>>> encoding: ascii
[...]

Traceback (most recent call last):
  File "./manage.py", line 11, in ?
    execute_manager(settings)
  File "/usr/local/lib/python2.4/site-packages/django/core/management.py", line 1678, in execute_manager
    execute_from_command_line(action_mapping, argv)
  File "/usr/local/lib/python2.4/site-packages/django/core/management.py", line 1592, in execute_from_command_line
    action_mapping[action](args[1:], int(options.verbosity))
  File "/usr/local/lib/python2.4/site-packages/django/core/management.py", line 1309, in test
    failures = test_runner(app_list, verbosity)
  File "/usr/local/lib/python2.4/site-packages/django/test/simple.py", line 84, in run_tests
    create_test_db(verbosity)
  File "/usr/local/lib/python2.4/site-packages/django/test/utils.py", line 118, in create_test_db
    management.syncdb(verbosity, interactive=False)
  File "/usr/local/lib/python2.4/site-packages/django/core/management.py", line 537, in syncdb
    _emit_post_sync_signal(created_models, verbosity, interactive)
  File "/usr/local/lib/python2.4/site-packages/django/core/management.py", line 464, in _emit_post_sync_signal
    verbosity=verbosity, interactive=interactive)
  File "/usr/local/lib/python2.4/site-packages/django/dispatch/dispatcher.py", line 358, in send
    sender=sender,
  File "/usr/local/lib/python2.4/site-packages/django/dispatch/robustapply.py", line 47, in robustApply
    return receiver(*arguments, **named)
  File "/usr/local/lib/python2.4/site-packages/django/contrib/auth/management.py", line 26, in create_permissions
    ctype = ContentType.objects.get_for_model(klass)
  File "/usr/local/lib/python2.4/site-packages/django/contrib/contenttypes/models.py", line 20, in get_for_model
    model=key[1], defaults={'name': smart_unicode(opts.verbose_name_raw)})
  File "/usr/local/lib/python2.4/site-packages/django/db/models/manager.py", line 76, in get_or_create
    return self.get_query_set().get_or_create(**kwargs)
  File "/usr/local/lib/python2.4/site-packages/django/db/models/query.py", line 280, in get_or_create
    obj.save()
  File "/usr/local/lib/python2.4/site-packages/django/db/models/base.py", line 246, in save
    ','.join(placeholders)), db_values)
  File "/usr/local/lib/python2.4/site-packages/django/db/backends/postgresql/base.py", line 54, in execute
    return self.cursor.execute(smart_str(sql, self.charset), self.format_params(params))
  File "/usr/local/lib/python2.4/site-packages/django/db/backends/postgresql/base.py", line 51, in format_params
    return tuple([smart_str(p, self.charset, True) for p in params])
  File "/usr/local/lib/python2.4/site-packages/django/utils/encoding.py", line 55, in smart_str
    return s.encode(encoding, errors)
UnicodeEncodeError: 'ascii' codec can't encode character u'\xe1' in position 7: ordinal not in range(128)