After some googling it will seem that Rewlly simple Syndication isn’t Really Simple. There’s some war going on among proponents for different RSS formats.
Regarding the content:encoding some feed readers will not treat it nicely.
More reading nescessary.
The content:encoding encapsulates in your feed a CDATA section, allowing you to have markup like <strong>FlashEarth</strong> in your content, whithout using enities like < and >, and still validate as XML, though I don’t know why you should or should not use content:encoding.