Sorry it took so long to reply. After looking at the WDT.c file again, there is atleast one non-ASCII character in a comment block, as Eran suggested. After removing this block, using UTF-8, CodeLite finds the target string. Also, changing the File Font encoding to a 'Windows-XXX' selection also finds the string in the original file. We have multiple developers working on this project, one of them does not have the approved settings for editing source files. Problem solved!
Thank you very much for the support guys.