str_replace() on multibyte strings dangerous?

No, you’re right: Using a singlebyte string function on a multibyte string can cause an unexpected result. Use the multibyte string functions instead, for example mb_ereg_replace or mb_split:

$string = mb_ereg_replace('"', '\\"', $string);
$string = implode('\\"', mb_split('"', $string));

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Edit    Here’s a mb_replace implementation using the split-join variant:

function mb_replace($search, $replace, $subject, &$count=0) {
    if (!is_array($search) && is_array($replace)) {
        return false;
    }
    if (is_array($subject)) {
        // call mb_replace for each single string in $subject
        foreach ($subject as &$string) {
            $string = &mb_replace($search, $replace, $string, $c);
            $count += $c;
        }
    } elseif (is_array($search)) {
        if (!is_array($replace)) {
            foreach ($search as &$string) {
                $subject = mb_replace($string, $replace, $subject, $c);
                $count += $c;
            }
        } else {
            $n = max(count($search), count($replace));
            while ($n--) {
                $subject = mb_replace(current($search), current($replace), $subject, $c);
                $count += $c;
                next($search);
                next($replace);
            }
        }
    } else {
        $parts = mb_split(preg_quote($search), $subject);
        $count = count($parts)-1;
        $subject = implode($replace, $parts);
    }
    return $subject;
}

As regards the combination of parameters, this function should behave like the singlebyte str_replace.