Ok. that got me thinking. So I went the other way.
If I take the actual path and "encode" it, this is the result:
QzpcVXNlcnNcR3JhbnRcRHJvcGJveA==
Now if I take the path as decoded from the hosts.db and then encode it, this is the result:
QzpcVXNlcnNcR3JhbnRcRHJvcGJveA8=
Clearly they are not the same. As you say, there are extra bytes added somewhere/somehow.
Am the only user that has this problem with DropBox? Maybe no-one else uses it?
DropBox is not taking into account the special character. Unicode instead of ascii? Wrong, or missing, byte-order marker maybe?
I am going to update the report to DropBox at any rate as it appears to be a problem with them.