I don’t know if this is SAP Adapter specific, or webMethods specific, so I’ll just post here.

When we receive IDOcs in XML format in the IS, they are encoded as utf-161e, which is causing me grief with an XSLT mapping that I have, since the XSLT engine is throwing a java.io.UnsupportedEncodingException.

So the question is: is there some global setting that specifies what the XML encoding should be, and can it be overridden somehow?

The encoding of the XML from SAP is controlled by SAP. If you need a different encoding check with your SAP team.