prosody migrator has a problem with charsets when migrating between internal storage and SQL one.
It's the same bug as this: https://groups.google.com/forum/#!topic/prosody-users/FLL9Nb060pQ but only in migrator, not prosody itself
One can convert the erroneous charset like this in SQL (modify this to do UPDATE):
select convert(binary convert(value using latin1) using utf8) from prosody
Thanks for the report.
The prosody issue you mention is #268. We will need to apply the same solution to the migrator.
Probably really should fix this before 0.10 is released :)