GoogleSpell checker already returns data un UTF8, so there's no need to use utf8_encode (in fact, using it completely mangles the string). All credit goes to David Quintal for finding the issue and proposing the fix.
Right align theme Clearlooks2 /lib/editor/tinymce/tiny_mce/3.4.9/plugins/inlinepopups/skins/clearlooks2/window.css