Where is the official Apple documentation for the Terminal App? I need a list of escape sequences Terminal.app does not implement all xterm sequences. I need to get the complete list of what it does implement. Is it available anywhere?
This is a bit vague... what sequences are NOT implemented?  One simple solution would be to see if iTerm2 is a better fit to your needs.  Incidentally, have you tried:

~$ cat .bashrc
export TERM=xterm-256color


(I am setting my TERM to xterm-256color in my bashrc, so that I get a number of xterm-256color behaviour by default).

Having said that, a few google inspired links that you might find useful, or not, depending on the sequences you are looking for:

https://discussions.apple.com/thread/1375184?start=0&amp;tstart=0

http://taoofmac.com/space/apps/Terminal