Q:

UTF-8 is giving me question marks

I have this simple PHP-script, which searches a mySQL database and outputs the result to the user. I used to use ISO-8859-1 as my charset, but was advised to use UTF-8. But I have trouble going from my former charset to the new one.
To clarify some things, I have:

Created a database and table encoded in UTF-8 with collation utf8_unicode_ci.
Encoded my PHP-file in UTF-8.
Set meta charset to UTF-8.
Set all text mime-types to UTF-8 through create-mime.assign.pl in Lighty (Lighttpd).

Now, the problem arises when I retrieve data from the database with characters like ö, ü etc. If I just do echo "ö"; without retrieving it from the database, it works fine. I guess there must be something wrong with the database then?
I've tried the following, and they've solved my problem:

Set meta charset to ISO-8859-1 (which, for some strange reason works, but breaks the echo'd "ö").
Set a utf8_decode() function around the output.
After mysql_select_db() declared the following mysql_set_charset('utf8');.

I know that I've found multiple solutions, but I just don't know why it wont work without them? And is it bad practice to use utf8_decode() on output, or the mysql_set_charset() function?

A:

MySQL is funny with UTF8. You need to ensure the server is running in UTF and that the connection is as well
If you can modify the my.cnf file on your server you can add these to the [mysqld] section and restart it
character-set-server = utf8
skip-character-set-client-handshake

You could alternatively (or as well) use
query("SET NAMES utf8");   

before sending/retrieving data to ensure the database expects UTF8 data to be passed

