Sounds like a locale bug to me.  Could you compile this test program?

#include <stdio.h>
#include <locale.h>

char *php_strtoupper(char *s, size_t len) {
    unsigned char *c, *e;

    c = s;
    e = c+len;

    while (c < e) {
        *c = toupper(*c);
        c++;
    }
    return s;
}

main(void) {
    char str[2];
    str[0] = 0xb9;
    str[1] = 0x0;
    setlocale(LC_ALL,"cs_CZ");
    puts(php_strtoupper(str,1));
}

Just save it to s.c, for example and type: make s
Then run it like this: ./s | od -x
And add the output here.
As far as I can tell 0xb9 gets uppercased to 0xa9 in 8859-2, so you should be seeing an a9 there in the output if your system's locale is working correctly.

Hello,
you can be right. I used your test program and output is:

0000000 0aa9
0000002

When I convert 0xaa9 to dec = 2729 and I write in Linux console <Alt>+<2729> I obtain the same character like when I write here <Alt>+<169>, which is dec from 0xa9. Both outputs are correct.

When I change "str[0] to "str[0] = 0x61;" (letter "a") in main function of your program, I obtain 

0000000 0a41
0000002

Jan Kirchner

Works fine for me.

So, the C progran correctly converted b9 to a9.  Now try the same thing with PHP:

php -r '$str = chr(0xb9);setlocale(LC_ALL,"cs_CZ");echo strtoupper($str);' | od -x

If that spits out a9 then PHP is working just fine and you are doing something wrong somewhere else.