Solution:1
See if custom post type has any files that are in UTF-8. If you change it to ANSI, that should help, if thats an issue.
Solution:2
I had the same issue, and found that there is a problem with my theme itself… try doing the same action using the twentyten theme. if that works, then take a look and see if there is any conflicting code in the functions.php of the theme…
if you are using a child theme can I suggest making another child theme, or using an alternative them as in my experience not all themes “like” being used as a child…