Recently I rooted and moded my Spica to Android 2.2 froyo by Cyanogenmod but it looks like they haven't put much thought to Hindi/Nepali fonts.
Even earlier the vowel signs were all messed up.
But I couldn't find any fix for this instead I found a work around in opera mini.
First let me tell you one thing, opera mini is a must app.
Open opera mini, in the address bar type
config:
In the bottom, there is an option
Use bitmap fonts for complex fonts
Set it to YES
And it will work only in opera mini. Well something is better than nothing.