Index: src/wp-includes/js/mce-view.js
===================================================================
--- src/wp-includes/js/mce-view.js	(revision 31688)
+++ src/wp-includes/js/mce-view.js	(working copy)
@@ -89,7 +89,7 @@
 		 * @param {String} content The string to scan.
 		 */
 		setMarkers: function( content ) {
-			var pieces = [ { content: content } ],
+			var pieces = [ { content: tinymce.DOM.decode( content ) } ],
 				self = this,
 				current;