I’m working with some people in Iceland and we were having trouble translating thorn (Þ, þ) in our URLs. The character would be simply omitted. I added the following to my config.php file.
str::$ascii = a::merge(str::$ascii, array( '/Þ/' => 'Th', '/þ/' => 'th', ) );
It looks like while eth (Ð, ð) is supported, thorn appears to be missing from the array.