How can I stop a function from encoding an entity?

Default Editor Content

Here is an updated version of the pu_default_editor_content() function which will take into account for when a user has disabled the Visual Editor (per your comment).

function pu_default_editor_content( $content ) {
    global $post_type;

    switch( $post_type ) {
        case 'post' :
            $content="Default content for blog posts. » » »";
            $rich_editing = get_user_option( 'rich_editing', get_current_user_id() );

            if ( 'false' === $rich_editing ) {
                $content = htmlspecialchars( $content );
            }   
        break;
    }

    return $content;
}
add_filter( 'default_content', 'pu_default_editor_content' );

Rich Text Editor Disabled view

User has Visual Editor disabled under User > Profile.

TinyMCE/QuickTags

If the Visual Editor is enabled, which is the default setup, TinyMCE will need to be configured to show named entities. Encoding is being applied by TinyMCE, but this behavior can be customized via the tiny_mce_before_init hook. Thanks to this answer for the tip.

Add additional entities that you may need to the $settings['entities'] string. Documentation on formatting is here:

This option contains a comma separated list of entity names that is
used instead of characters. Odd items are the character code and even
items are the name of the character code.

// Custom configuration for TinyMCE
function wpse241282_tiny_mce_before_init( $settings, $editor_id ) {

    // Used named encodings (the default setting in WordPress is raw).
    // https://www.tinymce.com/docs/configure/content-filtering/#encodingtypes
    $settings['entity_encoding'] = 'named';

    // Default entities for TinyMCE: 38,amp,60,lt,62,gt1
    // Additional entities: copy, reg, trade, service mark, euro, right angle quote, left angle quote
    // The odd entires are the entity *number*, the even entries are the entity *name*. If the entity has no name,
    // use the number, prefixed with a hash (for example, the service mark is "8480,#8480").

    $entities="169,copy,174,reg,8482,trade,8480,#8480,8364,euro,187,raquo,171,laquo";

    if ( isset( $settings['entities'] ) && ! empty( $settings['entities'] ) ) {
        $settings['entities'] .= ',' . $entities;
    } else {
        $settings['entities'] = $entities;
    }
    return $settings;
}
add_filter( 'tiny_mce_before_init', 'wpse241282_tiny_mce_before_init', 10, 2 );
add_filter( 'quicktags_settings', 'wpse241282_tiny_mce_before_init', 10, 2 );

Visual Editor Enabled

User has Visual Editor enabled under User > Profile.