Bug#613470: Inputenc incompatibility with non-braced functions

[Armando García Pérez <armagarper@gmail.com>]

Package: texlive-latex-extra (inputenc)
Version: 2009-10
Severity: minor

Error message:
! Package inputenc Error: Unicode char \u8:$ not set up for use with LaTeX.

Code:

\documentclass[]{book}
\usepackage[utf8]{inputenc}
\DeclareUnicodeCharacter{03BC}{\mu}
\begin{document}
$\vec μ$
\end{document}

(line #5 is the problem)

Expected behaviour:
succesful compilation; in the document, an arrow over a greek mu

The mu appears with an arrow with the code $\vec{μ}$; the code SHOULD work WITHOUT braces since $\vec a$ gives an a letter with an arrow above. 

It seems to me that the compiler first tries to process the function and later applies the inputenc mappings, giving rise to the error because of an unknown character. If this is true, processing first the encoding (and thus first replacing characters and later applying functions) would correct the error.