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how to reproduce:
add/edit a user
assign a "real name" in non-ascii letters. i've used Hebrew, for example "גרגמל"
save, and return to "users list" -- the name characters is saved as &#xxxx; and is unreadable.
for me this is a VERY LOW priority bug.
If you check the /etc/passwd file, is the real name in there in the correct characters, or has it been converted to HTML entities?