I tried to use JS Builder 3, included in Sencha Touch 1.1.0. While it does combine source files, it doesn't minify them. So I explicitly called ycompressor. Then you will get the illegal character errors. It seems that JSBuild encodes the resulting file in utf-8. You can get illegal character errors by specifying --charset utf-8 option for ycompressor.
So to combine and minify your js source files, create a build.bat file like this:
I hope this helps.
call \path\to\jsbuilder\jsbuilder.bat -p yourapp.jsb3 -d deploy
java -jar \path\to\jsbuilder\ycompressor\ycompressor.jar deploy\all.js -o deploy\all-min.js -v --charset utf-8