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Welcome 2 oracle forum!
Please refer MOS tech note:
*Which Character Set Supports Which Language [ID 62421.1]*
Hope this helps :)
Depends on what you mean by "smart character" - the documentation lists the capabilities of the various charactersets
It is recommended that you use AL32UTF8 - one simple way would be for you to upgrade using export/import. How big is your database ? How much downtime can you afford ?