I was just working with a deal like this yesterday. There is a thing in PHP called Magic Quotes. What it means is that quotes are automatically escaped with a .
When it's replaced is the issue here.
If you have magic_quotes_gpc turned on in your ini file, then any time you post a value that has a quote in it, the quote will be escaped.
There is another setting, magic_quotes_runtime. According to the manual:
If magic_quotes_runtime is enabled, most functions that return data from any sort of external source including databases and text files will have quotes escaped with a backslash.
Is it possible that this is why you are getting escaped quotes? The good news is that you can turn off magic_quotes_runtime with the function set_magic_quotes_runtime(0). Give that a try.