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Just some update:
XOOPS + 4.1.7(utf8 charset/utf8_general_ci collation):
Result: all modules(blocks) content will become blank. Don't know reason why.
XOOPS + 4.1.8/9(utf8 charset/utf8_general_ci collation):
Result: XOOPS working normally. It is NOT a matter of either using XAMMP or install MYSQL/PHP individually, i.e. not config files related problem.
Thanks irmtfan, you gave me a clue on upgrading the MYSQL.
And somehow it was my fault, since I upgrade to 4.1.7 in Dec. I don't expect they will release up to 4.1.9 in Jan.(so quick), so I didn't go to mysql.com. If I notice 4.1.8/9 was released, I should have try this upgrade route at the very beginning.
Thanks m0nty and irmtfan.
p.s.
I tried to move my db(utf8) from 4.1.0 to 4.1.9 now. The blocks are working fine now, however, all charactes become ???. But anyways, it maybe another issue. I will figure out later on.