I'm working on a legacy project with all files in ISO-8859-1, so I have set up my project settings file with:
"fallback_encoding": "Western (ISO 8859-1)",
"default_encoding": "Western (ISO 8859-1)"
This works perfectly for newly created files and for files that contain non-ASCII-characters. But when I open a file with only ASCII characters Sublime Text 2 uses UTF-8 encoding for it. So when I add an Umlaut (äöü) or anything non-ASCII, the file gets saved as UTF-8 instead of the default_encoding which I had set and the characters are displayed wrong in my application.
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