I am using the hack with Droid font set (posted on your blog), and it does display Cyrillic if I use a PDF source and convert it to MOBI. So, the font hack definitely works.
However, if I download a TXT file from Moshkov's e-library, for example, and open it in Word for cleanup, that's where trouble begins. Word asks me how I want to convert it. If I click on "UTF-8", the text is garbled. If I click on "Unicode", the text is in normal Cyrillic. However, if that normal Cyrillic (saved as RTF) is then run though Calibre and converted to MOBI, the result is garbled. Total bafflement!