Note -- no text properties, and not represented as "f\363o".

*scratches head*

So is this a problem with how ert calls the byte compiler after all?

This is with

diff --git a/lisp/emacs-lisp/bytecomp.el b/lisp/emacs-lisp/bytecomp.el
index 966990bac9..07448033ac 100644
--- a/lisp/emacs-lisp/bytecomp.el
+++ b/lisp/emacs-lisp/bytecomp.el
@@ -1990,6 +1990,7 @@ byte-compile-file
 	(with-current-buffer output-buffer
 	  (goto-char (point-max))
 	  (insert "\n")			; aaah, unix.
+          (message "foo 1: %S" (prin1-to-string (expand-file-name target-file)))
 	  (if (file-writable-p target-file)
 	      ;; We must disable any code conversion here.
 	      (progn
@@ -2007,6 +2008,7 @@ byte-compile-file
 			(cons (lambda () (ignore-errors
 					   (delete-file tempfile)))
 			      kill-emacs-hook)))
+		  (message "foo 2: %S" (prin1-to-string tempfile))
 		  (unless (= temp-modes desired-modes)
 		    (set-file-modes tempfile desired-modes 'nofollow))
 		  (write-region (point-min) (point-max) tempfile nil 1)


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