Thanks for the follow up folks. Well from what I can see** utf8_general_ci **based on the row statistics in phpMyAdmin. It's a clean install of 1.53 so all the php scripts would be utf8 I imagine. The DB charset is utf8 in both store and admin configure.php files. However when I run the convert_db2utf8.php script, it reports latin1_general_ci for most of the tables and utf8 for a few admin tables.
Everything pretty much seems to work except when I migrate the data from 1.39 to 1.53. Even then most of it works, except the PayPal Express payment module not listing the product line items. The transaction still goes through, but I don't get the line item detail. Before the data migration, even that worked fine. Thus I am fairly certain its the data in the database that might have got corrupt previously, but somehow kept working in 1.39. i.e. line items descriptions came through fine in 1.39 payment process.
Originally I think in v1.39 after the web host upgraded MySQL to 5.3 and PHP 5.4, I seemed to run into problems with that  character appearing all over the place. so then I tried to restore a backup, which didn't fix the issue. So I've been using 1.39 with the problems associated with the server upgrades which seem to include product description data not saving and  characters everywhere.
Once the PayPal POODLE BUG kicked in on Dec 3, I thought I better upgrade to 1.53, but then realized after many hours mucking around, and checking the forum, that the POODLE BUG was not related to the utf8 / iso-8859-1 issue. Anyway having found the POODLE BUG one liner Fix in paypal_curl.php, I was still left with this other issue with concern about the data integrity and  characters. I ran that** convert_db2utf8.php** fix, but it failed to eliminate all the ** **characters.
Anyway I'm trying to decide the best approach from here onward. My preference is to conquer this, so I don't have to recreate all the data. I'm also concerned about what impact it could have on my Google ranking if I start from scratch, with new product links and product numbers etc... that don't match up with what's in Google. Thus a few issues of concern.
Getting back to the core issue. All works fine until the database is migrated from 1.39 to 1.53. Oddly though after the data migration, even if I create a new product from scratch, I still get the same problem of no product line detail in the order, for that new product addition. Prior top the data migration, I get the product detail in the order fine.
OK so I have now just run the convert_db2utf8.php script and it now reports all is converted and everything as utf8. Still however the same issue remains and no product detail is being listed in the PayPal transaction. The product detail is only listed in the store transaction receipt.