Great investigatiom here!
Out of curiosity: Everett, could you test this with the OkHttp driver?
If it works out of the box without the workaround (it could, as it doesn't use the sun classes), it could be worth adding a property to jclouds to configure the file encoding, that could be read by the default java http driver and taken into account, if present.
Wow, this is a good one. Thanks for digging all this up, Everett!