I think it’s not good, not even a single word :) It’s not correct to map a single letter in arabic to a letter in english, it’s quite hard to explain. but for example the sentence you provided could be something like this:
“Ana qader ala akel alzojaj wa hatha la yo’limony”

As you can see the sound of a basic letter is almost always accompanied with vowel.

That’s what I’d feared. For languages with a closer relationship to the Roman alphabet, seems to do a good job. Sean notes the limitations here;

Text::Unidecode is meant to be a transliterator-of-last resort, to be used once you’ve decided that you can’t just display the Unicode data as is, and once you’ve decided you don’t have a more clever, language-specific transliterator available. It transliterates context-insensitively — that is, a given character is replaced with the same US-ASCII (7-bit ASCII) character or characters, no matter what the surrounding character are.

and oh do you know what the sentence means, it’s weird it means “I can eat glass, and that doesn’t hurt me” wondering where you got that from

Hmmm - not such a nice thing to teach beginners. It comes from here: http://www.columbia.edu/kermit/utf8.html

Before: *Arabic*: أنا قادر على أكل الزجاج و هذا لا يؤلمني.
After: *Arabic*: ‘n qdr `l~ ‘kl lzjj w hdh l yw’lmny.

I think it’s not good, not even a single word :) It’s not correct to map a single letter in arabic to a letter in english, it’s quite hard to explain. but for example the sentence you provided could be something like this:
“Ana qader ala akel alzojaj wa hatha la yo’limony”

As you can see the sound of a basic letter is almost always accompanied with vowel.

Before: *Arabic*: أنا قادر على أكل الزجاج و هذا لا يؤلمني.
After: *Arabic*: ‘n qdr `l~ ‘kl lzjj w hdh l yw’lmny.

Would be interested on your opinion of how good that is.

For people who are not aware of this, there is also a (much faster) PHP extension for this already:
http://derickrethans.nl/translit.php

Derick - have you thought of doing a pure PHP interface to your database files? Think a problem for many is hosts where they can’t install new extensions (plus for those writing PHP apps for mass deployment, extension dependencies tends to be a problem).