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The other downside of using the solid arrow character between title tags is that it won't display properly in your title bar -- in fact, your title bar won't display anything (in IE at least), just the filename.
If Google is concerned about this, just filtering out these characters makes a lot more sense than penalizing. Some of the webmaters using these may not even thinking about SEO. Think here a teenager who add these to her page title because she saw her girlfriend do it on her site, and just thinks it "looks cool."
Also, I just checked one of my websites that I had put ★ on a couple days ago to see if it was still working... freshbot picked it up and it's now showing in SERPS.
The intention behind it is making ultimate users to misunderstand as Google's recommendation.
It was not an announcement and it was not displayed for a period of time. It may be similar to the Stemming when it appeared for a time then dissapeared and it is now with us.
I don't know if it will come back but we like to keep everyone up with our observations. How I new it was gone is I keep track of a couple sites that also have the arrow.
I don't think for most it is to be construde as Googles recommendation but to attract the viewer to see your listing rather than your competitor. I could see that it could have that assumption though it the listing is at or near the top.
This is just another fascinating aspect of the "co-evolutionary" relationship between site designers/optimisers and Google.
Google urges web designers to ask themselves "Would I do this if search engines didn't exist?" -- but to adopt such an approach would be naive. The fact is that search engines not only exist, but sites depend on getting listed in them.
The real trick is to find a balance between usability and findability.
So if the code &oe=UTF-8 is in the URL the eye-candy will show, if not it will be?.