SEO, HTML/XHTML validity and Ampersands in URIs

Can SE bots handle & in URIs?

[brickwall]

I always go to great lengths to ensure all pages in every website that I release is HTML/XHTML valid.

Always, I get into trouble upholding my own standards whenever I directly link to other sites with raw ampersands (&) in their URIs. These links simply won't validate.

Simple enough you say, just replace the raw ampersands in the URIs with & and the problem is solved, document will be valid.

<a href="foo.cgi?chapter=1&section=2&copy=3&lang=en">

transformed into:

<a href="foo.cgi?chapter=1&amp;section=2&amp;copy=3&amp;lang=en">

But how about on the SEO side?
Won't this type of sanitized URIs lead to problems? Canonicals and dups perhaps?

Will the major SE bots be able to handle URIs like these without untoward penalty to my site or the site being linked to?

[pageoneresults]

Will the major SE bots be able to handle URIs like these without untoward penalty to my site or the site being linked to?

I don't recall ever running into any issues with escaped ampersands and I've been getting them out of jail for years. ;)