even though fonts are embedded in the pdf, they will still not be available in other applications - you cannot edit an embedded font in illustrator unless you have that font on your computer. That is the copyright protection kicking in and the only legal way through is to buy the font.
The pdf will print correctly through acrobat and can also be ripped successfully by a printer - neither of these apps allow editing.
If you know that you have the font, then it is not loaded - you can load the font with suitcase or similar or drop it in your start-up fonts folder (not recommended because, if you make a habit of it you will find your system slowing down on account of the hundreds of fonts it has to handle).
As Roger said, when saved without the additional Illustrator editing capabilities, the behavior for PDF is normal. AI may recognize the font names and stuff, but since it doesn't know how the text was originally created, it may attempt to replace it. The text may have been manually formatted or received otehr treatments and then it is either editability or appearance, but rarely ever both. You would certainly experience the same when trying to edit the text in Acrobat itself.
Thanks, but if the font is just plain Arial as in the attached PDF file, then wouldn't it be already loaded? And this doesn't explain why the accented character is being corrupted when the PDF file is loaded in Illustrator, are you able to replicate that?
Update: In Acrobat I can load the PDF file and it looks fine, I can also edit the text with no problems.
I think you are misunderstanding something here/ not understanding how PDF text embedding works. If PDF files contain embedded fonts, those take precedence over local system fonts. Each font or sub-set of a font (if "only embed used glyphs" is chosen) is assigned a unique identifier number to reference it. Names are only stored based on how the file was created. It is up to the program opening the PDF file to read that info and make sense of it. This may allow to re-create an editable document, but as I already wrote, based on what priorities apply, it may not. The only way to make sure a document remains editable is to attach the source in a separate chunk, which is what Retain Illustrator Editing Capabilities does. The rest is far out and far inbetweeen, as they say...
Right, I understand how PDF text embedding works, but I'm a little hazy on how Illustrator works.
Since it wants to edit the file and can't necessarily find the "Arial" font on the system it substitutes its own font, that's fine. But why is the accented character corrupted to a caret? The text is correctly encoded in MacRomanEncoding, and should be perfectly valid.
Although it is Arial you may find that it is not exactly the arial you have on your system. If you do have a same/similar version of Arial you can go TYPE > FIND FONT and replace all instances of the missing font with the one that you have. It may look identical or may have slightly different kerning or whatever. If your text is broken into individual letters you're going to have to reset it.
I did this the other day with an ai file that had a missing font:
open it in acrobat and save as pdf then place the pdf in AI - it will preserve the font styling and scalability but not be editable.