It should not make any difference, no matter the data source used. You can test a RadComboBox bound to an SQLDatasource with our online RadComboBox demo
. The RadComboBox in this demo has entries with non-English characters, "Tradição Hipermercados" for instance, and is working correctly at my side.
What I can suggest is try to isolate only the the RadComboBox from your project and then gradually add the other functionality. This should help locate where the problem originates from.
Check out the Telerik Platform - the only platform that combines a rich set of UI tools with powerful cloud services to develop web, hybrid and native mobile apps.