'utf-8' codec can't decode byte 0xda in position 184: invalid continuation byte

[snippsat]

After opening as 'utf-8' for writing, the file works well with the subsequent converter.

Yes,remember utf-8 out and in,OS and local system can mess up stuff and choice wrong encoding.

newFile = open(fileName, 'w+', encoding='utf-8')

- C:\code would be a path to my code file?

No this is where i placed the file,you can choose whatever place you like.
Rember that python and pip should work from any folder same for all OS,for Windows look here
So a test like this should work no matter which folder on OS you are in.

E:\div_code\click
λ python -V
Python 3.7.3

E:\div_code\click
λ pip -V
pip 19.2.3 from c:\python37\lib\site-packages\pip (python 3.7)

- What does that λ mean?

That use cmder a much better shell than cmd/Poweshell.

- What is the difference between your first and second example? Just the same with different encoding depending on how you save the file?

When i use rb then i read file in binary(no encoding).
With Unicode still need to decode to a encoding.

>>> s = b'<i>[M\xc3\x9aSICA]</i>'
>>> s
b'<i>[M\xc3\x9aSICA]</i>'
>>> type(s)
<class 'bytes'>
>>> 
>>> t = s.decode()
>>> t
'<i>[MÚSICA]</i>'
>>> type(t)
<class 'str'>