We can try to restrict characters that are clearly dangerous, adopting, if necessary, a view that the fact someone wants to register or use a particular string doesn't mean that they are entitled to do so.
We can use the UDRP and/or the legal system in various countries to push back on those who register deceptive names and on the registrars and registries that encourage the registration of such names.
Hasn't this stuff been covered in any RFC yet?
Erik