The former really only shows the consequences of a non-user centered design approach or a shameful lack of tact and diplomacy from the Microsoft crew in charge of the localization of Windows in the Mapuche language. They could have at least tried to include the actual ultimate stakeholders in their otherwise honorable initiative to translate windows in Mapuzugun .
Looks like Microsoft is a little bit too much in a hurry to move down the path of a 100% internationalized windows, including all dialects (sic!).

The latter sounds to me like an interesting bit of information, maybe even a real milestone on the road of global standards and on our way to a truly universal / multi-cultural rich web. Even though as a programmer I feel a little shiver running down my spine, I still like to hear that there is movement towards greater standardization on the level of language and exotic character set integration in the digital world . Is this going to start as a new nightmare on the internationalization front ? I do not fully see the impact yet.

Here is more about the technical bits:
( source)

After a decade of painstaking work and negotiations, however, Internet engineering groups have solved the problem of internationalized domain names. A widely accepted standard is in place, and Web browsers such as Mozilla's Firefox, Apple Computer's Safari, and Microsoft's Internet Explorer 7 (released last month) support non-English-language characters in domains.

"Regarding the technical implementation for the World Wide Web, we are done, except for maybe some corner cases," said Patrik Fältström, a senior engineer with Cisco Systems who is the co-author of an internationalized domain name specification inside the Internet Engineering Task Force.

Internationalized domain names work something like this: Nonstandard characters are translated into ASCII through algorithms called "Nameprep" and "Punycode," with a special "xn--" prefix attached that signals that it's an encoded domain name.