This is pretty serious:
$ printf 'p\xc3\xa8re\n' |LC_ALL=en_US.utf8 grep -w p
père
I installed a fix for this just now. This doesn't fix all of Bug#16867, just this particular issue.
Here's the fix: http://git.savannah.gnu.org/cgit/grep.git/commit/?id=94555dd281cdcd7530bc2c4466f0bbfd8d47d5c0
