I might be completely off here but the error message is the one you get from the .NET xml classes when trying to parse XML which contains illegal characters (like &, ") outside CDATA elements. I had this problem in a completely unrelated issue a few days back, and I think the cause was "xml inside xml" which will probably be the case when putting a linkcollection (serialised as xml?) inside dynamic content (serialised as xml?). Perhaps it can be prevented by taking extra care how the properties inside the dynamic content is serialized (for example, base64-encode everything)?

The data is serialized with base64-encoding.

But true, the error seems to occur while parsing the data. Will have a closer look at that.

It works fine with links to documents and external links like www.google.com.

Internal links and external links like www.google.com?test=1&test2=2 do not work, so it seems to be the & character. What I don't get is why this error occurs when the data is base64-encoded.