Hell, thats a minor bug. Check out the threads about dual monitors and 1.5 gig of RAM. We cannot even run the installer. It has a kernal panic when there is a Radeon card installed for a second monitor and hangs giving the newly daubbed "grey screen of silence". If you pull the card you can install, but the machine will crash as soon as you put it back in. Not too sexy considering that alot of Mac users are graphic professionls.

It doesn't mean that "the server isn't configured to parse %23 as # in a URL": it means that replacing # with %23 is precisely the method that must be used to access a file with a # in its name. So the server should absolutely not try to figure out it should be a simple anchor #.
An app replacing # with %23 is just as stupid as if it replaced slashes with the appropriate %-code, which would also break the URL's.

Its anywhere you can cmd-click a URL withe # in it. It would be nice if this could be blamed on M$, but it just ain't so.

That's in Mail, too? I figured it was just an Entourage idiocy. Anyhow, here's the workaround.