Oracle driver and language specific chars
Indeed, the OLEDB provider from Mircrosoft is deprecated for ages and you should not use it anymore. Certainly it can have problems when you work with Unicode.

Use the OLEDB Provider from Oracle. After installing it, it should be sufficient to modify just the connection string from connectString = "Provider=MSDAORA;Data Source=... to connectString = "Provider=OraOLEDB.Oracle;Data Source=....

OLEDB Provider from Oracle always use UTF-16 (see OraOLEDB Provider Specific Features), so german "Umlaute" should be no problem.

Note provider msdaora also uses local Oracle Client installation (like OraOLEDB.Oracle), you cannot use it without any Oracle Client installation. 

In order to verify properly what is stored at database level try

select DUMP(c.custname, 1016) FROM ...