@staticshock reports that a file with a single latin-1 character is degrading pretty badly in Diffusion (showing a blank file instead of describing the error or recovering from it).
Broadly, if we hit a file which has an encoding which we don't expect (i.e., not the repository's configured encoding, as per T452), we should try to recover more gracefully. Anything (explicit error, attempted conversion with note) would be better than what we do now.
See also T2999, T452.