Short answer: yes.
Long answer:
 > Just to clarify things in my mind, would the following be allowed
 > in your world?
OK. Good. I like specific examples. They tend to elucidate a lot of
subtleties.
 >  HTTP headers followed by HTML document:
 > 
 > 	HTTP/1.0 200 OK
 > 	Date: Saturday, 29-Apr-95 03:53:33 GMT
 > 	Server: ...
 > 	MIME-version: 1.0
 > 	Content-Type: text/html; charset=iso-2022-jp
 > 	Last-modified: Tuesday, 18-Apr-95 16:10:13 GMT
 > 	Content-length: 15132
 > 
 > 	<TITLE>...</TITLE>
 > 	<BODY>
 > 	Here is some normal text.
 > 	Here is a 10646 numerical entity: �.
 > 	Here is some ISO-2022-JP text: ...
 > 	</BODY>
 > 
OK... so what we have above is an HTTP response, which is a response
line followed by what's called (in MIME and HTTP) a message entity.
To interpret the message entity, you look at the Content-Type.  It
says "text/html". So you look at the html spec. My working draft (to
be release ASAP!) says:
|3.2  HTML Document Representation
|
|   A message entity with a content type of "text/html" represents an HTML
|   document, consisting of a single text entity. The charset parameter
|   (whether implicit or explicit) identifies a character encoding. The
|   text entity consists of the characters determined by this character
|   encoding and the octets of the body of the message entity.
So we take the charset parameter, iso-2022-jp, and we use that
to map the octets of the body of the message entity to a sequence
of characters.
During this step, the octets represented by '...' in:
 > 	Here is some ISO-2022-JP text: ...
turn into characters. Nothing surprising happens to this stuff yet:
 > 	Here is a 10646 numerical entity: �.
OK. Now we have a text entity: a sequence of characters. To parse
as per ISO8879, we need to know the document character set. In
the internationalization document (which I don't have handy... sorry)
we're specifying that the document character set for HTML is ISO10646.
So to interpret:
 > 	Here is a 10646 numerical entity: �.
We look up 23598732 in the ISO10646 specification, and see what
character it maps to.
Simple, no?
 > If this is allowed, I agree that this would be a good way to migrate
 > to the Brave New World of 10646.
One by one, we're all coming to this very conclusion.
Dan