But nevertheless, I'll answer your question. Godaddy actually DOES allow them. Check:
Code:
http://www.godaddy.com/domains/searchidn.aspx
Never had any issues with them (DNS, mailing etc), because they actually get transformed to something called punycode, e.g. the above mentioned "XN--8CA.NET" is punycode, check http://en.wikipedia.org/wiki/Punycode
How it displays in the user's browser is up to the browser.. Some browsers display the punycode version in the address bar, some the scripted version.. That's something you cannot alter.
And yes, there are a lot of untapped markets here.
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