The "gibberish starting with an ampersand", &#___, is just the way that HTML encodes Unicode (i.e. extended character set) characters. It is appearing because you are trying to send E-mail containing non-HTML characters as HTML, so the converter is converting them to Unicode.
HTML2.0 only includes a limited character set. &# 8217 (split up so that this BB doesn't try to reconvert it!), for example, is the Unicode symbol for a "Right Single Quotation Mark". This is not a displayable character in ISO 8859-1 Latin 1, and is not part of any HTML standard - it will be displayed differently in browsers on different platforms.