If you are still using Alpha 7 as it says above, then you need to upgrade about 7 versions to Beta 7. There are a lot of bug fixes since then.
You can keep ISO-8859-1 on your forum, but VaultWiki will be UTF-8 on wiki pages. Since Beta 4 there should not be a problem with mixed encodings.
For the error you're seeing, if you're already on the current release, then we might have to run the importer for you. We rewrote it in the upcoming release and it should be a lot better. In this case, I can send you a free import service if you'd like and we'll try to look into it ASAP.