char ref question

Hi list,

Short version: Must character references in attribute values get 
expanded by an XML parser?

Long version: When a document like

<?xml version="1.0" encoding="iso-8859-1"?>
<foo bar="&#955;"/>


is accessed by an API like SAX on top of an XML parser like piccolo must 
the exposed attribute value be "&#955;" or "λ" (greek lambda)?


Thanks,

Manos