I'm sorry, in Ikariam UK the answer is no, no diacritics at all.
We already had in the past discussions about "what" to consider as valid diacritics and what is not: we tried to define a set of diacritics, but constantly, there was someone who looked for a way to circumvent this rule, WITH success, to become unsearchable using a UK/US keyboard. Since we can't spend our time checking any username, verifying if it is searchable or not, and since the language in Ikariam UK is English, it's easy: you can't use non-English character sets or diacritics in the username. It's a simple and clear rule.
If you want to name you "gƩnie" or "Spīgana", then you cannot, I'm sorry: you will have to rename you "genius" or "witch" (or remove the diacritics or use another name). As stated in the forum, this does not apply to villages, with some other limitations, but usernames must be plain ASCII. Full stop.
Anyway, we are not here to ban just for fun or without warning you before. Due to the merge, we sent out a "yellow message" to everybody to remind the rule. Indeed, we also send a further friendly reminder to the people who didn't accomplish the request, and if nothing changes, we ban 9999 days with Contact Me, to let the player poke us via ticket system to have the account released under the condition to change the username
Further details here: Language in Ikariam UK.
Kind regards.