Use utf-8 instead of unicode_escape when forcing encoding.

unicode_escape messes up escaped chars in strings. We'll assume we're
interacting with valid utf-8-encoded strings.

Closes #70
Closes #79

yapf/yapflib/py3compat.py

@@ -70,7 +70,7 @@ def unicode(s):
   if PY3:
     return s
   else:
-    return __builtin__.unicode(s, 'unicode_escape')
+    return __builtin__.unicode(s, 'utf-8')
 
 
 # In Python 3.2+, readfp is deprecated in favor of read_file, which doesn't

yapftests/yapf_test.py

@@ -121,6 +121,23 @@ def foo():
     self.assertIsNone(stderrdata)
     self.assertEqual(reformatted_code.decode('utf-8'), expected_formatted_code)
 
+  def testReadFromStdinWithEscapedStrings(self):
+    unformatted_code = textwrap.dedent(u"""\
+        s =   "foo\\nbar"
+        """)
+    expected_formatted_code = textwrap.dedent(u"""\
+        s = "foo\\nbar"
+        """)
+
+    p = subprocess.Popen(YAPF_BINARY,
+                         stdout=subprocess.PIPE,
+                         stdin=subprocess.PIPE,
+                         stderr=subprocess.STDOUT)
+    reformatted_code, stderrdata = p.communicate(
+        unformatted_code.encode('utf-8'))
+    self.assertIsNone(stderrdata)
+    self.assertEqual(reformatted_code.decode('utf-8'), expected_formatted_code)
+
   def testSetGoogleStyle(self):
     unformatted_code = textwrap.dedent(u"""\
         def foo(): # trail