See issue 1330 where a user has a nice summary and test case
http://code.google.com/p/fbug/issues/detail?id=1330

On Feb 20, 2:36 am, theashman <[email protected]> wrote:
> Hi there,
> Recently a collegue of mine was using Smarty to develop a site. It
> involved the use of AJAX and he was using firebug to take a look at
> the source to see what was changing and when. He noticed that Firebug
> didn't show the encoded HTML Entities on the 'Inspect' tab. He was
> going mad thinking that Smarty was not working correctly. I then
> tested a site with hardcoded ampersands and quotations to see if the
> same happened. It did. We viewed the source on both sites to ensure
> the entities were being encoded, and sure enough they were.
>
> We concluded that Firebug does not display the source correctly, by
> not showing the encoded entities.
> E.g Showing "&" instead of "&amp;"
>
> Will there be an update to include this in the future?
>
> Thanks
>
> TheAshMan
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