At first I received the same error in this thread and applied the fixed as suggested. This works ok until I Edit Fields in the Designer. On saving the changes the OLAP settings are placed back into the code. I am then required to delete the code to fix this problem. I am constantly back-and-forth using Edit Fields while building my application.
I don't see this as a Feature Request as suggested in the thread, rather a Bug based on this behavior.
<OlapSettings> <XmlaConnectionSettings Encoding="utf-8"></XmlaConnectionSettings> </OlapSettings>