Here is a bit more explanation:
This is how my linux box (locale of en_US.utf-8) automounts a vfat formatted sdcard:
/dev/mmcblk0p1 /media/user/PANDA01 vfat rw,nosuid,nodev,uid=1000,gid=1000,shortname=mixed,dmask=0077,utf8=1,showexec,flush,flush,uhelper=udisks2 0 0
This is how the openpandora automounts the same card:
/dev/mmcblk0p1 /media/PANDA01 vfat rw,dirsync,noatime,fmask=0000,dmask=0000,allow_utime=0022,codepage=cp437,iocharset=iso8859-1,shortname=mixed,errors=remount-ro 0 0
Notice utf8 in one versus iso8859-1 in the other. Thus files with utf8 filenames (e.g., with umlauts) that get transferred from the linux box to the sdcard get garbled when shown on the openpandora in iso8859-1 filenames.
As an aside, in reading up on vfat (
https://www.kernel.org/doc/Documentation/filesystems/vfat.txt), it recommends against iocharset=utf8 and instead recommends utf8-1, which is the "filesystem safe version of unicode that is used by the console." So, my original title was not quite correct.
An unsatisfactory workaround is to manually mount the sdcard on the linux box with "-o iocharset=iso8859-1" and copy the files over to the card (with linux automatically taking care of the filename encodings). When mounted on the openpandora, the now iso8859-1 umlauts look good. However, this doesn't solve my quest to get the openpandora to automount with utf8.