Just realized what was wrong.. setting the locale correctly in the first script fixes the problem. The script now looks like:

use strict;
use warnings;
use locale;
use POSIX qw(locale_h);
                                                                      
+         
binmode( STDOUT, ":utf8" );
                                                                      
+         
setlocale(LC_CTYPE, "german");                                        
+                                       
my $accented_char = "\x{00dc}"; #Upper case U with DIAERESIS
print "accented char=$accented_char\n";                               
+                                                
my $lowercased = lc( $accented_char );                                
+                                               
print "lowercased=$lowercased\n";
[download]

The question I have now however is why I need to set the locale in one case (the script above) but not the other (the second script that reads from stdin in my first post).
According to http://perldoc.perl.org/functions/lc.html, my best guess is that the UTF-8 flag is set on the string when it is read from stdin, but not when the string is instantiated in the code itself. Is there a way to confirm this?

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