OutOfMemory Exception duing mysqldump
Just like  Michael - sqlbot suggested, --quick would help. Official MySQL Doc states:


  --quick, -q
  
  This option is useful for dumping large tables. It forces mysqldump to
  retrieve rows for a table from the server a row at a time rather than
  retrieving the entire row set and buffering it in memory before
  writing it out.


http://dev.mysql.com/doc/refman/5.7/en/mysqldump.html#option_mysqldump_quick

Regarding the PowerShell issue, there's a note on MySQL Doc:


  Note:
  
  A dump made using PowerShell on Windows with output redirection
  creates a file that has UTF-16 encoding:
  
  shell&gt; mysqldump [options] &gt; dump.sql 
  
  However, UTF-16 is not permitted
  as a connection character set (see Section 11.1.4, “Connection
  Character Sets and Collations”), so the dump file will not load
  correctly. To work around this issue, use the --result-file option,
  which creates the output in ASCII format:

shell&gt; mysqldump [options] --result-file=dump.sql



http://dev.mysql.com/doc/refman/5.7/en/mysqldump.html