Thanks for finding this. It does look like it is in Ascii Standard and not Unicode. However, the changes you sent me are not correct in that the characters are not the same (now they are basic English). I will make the appropriate changes, but this file is not one that is updated in a game update - so the changed file will only be reflected if manual step are taken after the update or a new Data structure is created.
I have also amended the spelling mistakes you found, thank you for those. The misspelled Friendly Defeat is in that localization file.
Regarding the non-escaped single quote, I know you do not agree with it, but this is not standard XML nor will it be. And it would be a mistake to assume I use a standard xml parser because I do not.