Exactly, in some contexts it is displayed like this to mitigate homograph attacks, where someone creates similar looking URLs for phishing purposes.
Nothing shady about Punycode by itself, but it's good to be aware of homograph attacks.
Internationalized domain names (IDNs) are cool :)
Not sure what's your point at this point. If you're that worried you could've used the wayback machine or disabled JavaScript on your browser sense the website is functioning without them anyways.