David - would you get a good approximation of what you want simply with:

    self.assertEqual(ascii(first), ascii(second))

(This actually returns "b'first'" "b'second'" so you may want a convenience function that chops the leading and trailing b'/')

As ascii returns unicode it would automatically delegate to assertMultilineEqual.

The obvious way to hook this up by default for assertEqual is having the split-character as '\n'. This would not be meaningful for using assertEqual to compare bytes that *aren't* text.