{{PAGESINCATEGORY:{{PAGENAME}}}} doesnt work if the category name contains ' (it will display 0) - I have tested it here too (preview) at the Category:Chris G's botclasses Is there a solution? (Its {{PAGENAME}} which is the problem, because it works if you change it with the title in clear text).
Topic on Project:Support desk
I think there's a bug filed about {{PAGENAME}} outputting encoded entities for non-ASCII characters when used inside Parser functions. Will try to find it.
There was a similar one. I've created bug 67196
A little late, but thanks :-) The bug is pretty old...
Well you know, when you write about it here, you never know who might see it and become interested in fixing it :)