I tried to fix this two years ago, here is the patch (not merged):
http://bugs.python.org/review/24117/diff/14803/Modules/cjkcodecs/_codecs_cn.c

But later, I thought it's a good opportunity to remove this codec, this serious bug indicates that almost no one is using it. But fixing will create a possibility that someone will using it in future.
So I suggest we don't fix it, just remove it or leave it as is.

hz is outdated, searching on internet almost no one talking about it.

> Or do you know other bugs?
It has another small bug in decoder, about state switch, but it's trivial, also fixed in the patch.