This occurs since v. 6.3.
I’m getting “ORA-29275: partial multibyte character” at some data regardless the setup in Preferences / General / Session / National Language Support.
I remember that in 6.2.1 it worked the opposite way, i.e. when I had “Display and Edit multi-byte data” enabled it also gave ORA-29275, but when I had “No Support” it worked.
In 5.5.4 it worked just fine as one would expect.
Tested with Oracle client 11gR1 220.127.116.11 against Oracle DB 10gR2 10.2.0.3