sv_catsv handles "get magic", so overloaded strings shouldn't be a problem. It doesn't handle "set magic", though, so if the first scalar is tied and it does something funny with STORE -- like store an uppercased version of the input -- that won't happen.

#!/usr/bin/perl
package TiedScalar;
use strict;
use warnings;
use base qw( Tie::Scalar );

sub TIESCALAR {
    my ( $classname, $initial_value ) = @_; 
    return bless \$initial_value, __PACKAGE__;
}

sub FETCH { return ${ +shift } }

sub STORE { 
    my ($self, $value) = @_;
    $$self = uc($value);
}

package main;
use strict;
use warnings;

use Inline C => << '__C__', NAME => 'test', CLEAN_AFTER_BUILD => 0;
#include <stdio.h>

SV* test( SV *a, SV *b ) {
    if( SvREADONLY( a ) )
        a = newSVpv( SvPVX( a ), 0 );
    else
       SvREFCNT_inc( a );

    if( !SvOK( a ) )
        sv_setpvn( a, "", 0 );

    sv_catsv( a, b );
    return a;
}

__C__

my ( $q, $p );

tie $q, 'TiedScalar', "bill"; 
tie $p, 'TiedScalar', "fred"; 

print test( $q, $p ) . "\n"; 

$q .= $p;
print "$q\n";
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As for the exotic values via SvPVX, I can't think of an example that would cause any more problems than say, packed ints.

As for nulls in read-only scalars, I would think sv_catsv would handle that case, no?