Hi!
I think that I already have solved this, but awaiting confirmation I haven't committed the change. In short, when either fringe is zero, Emacs reserves one column for a terminal-style continuation character. The function `window-adjust-process-window-size' in window.el should use `window-max-chars-per-line' rather than `window-body-width' to take the continuation character into consideration.
See
http://debbugs.gnu.org/cgi/bugreport.cgi?bug=22891#26 for details.
In that message I also suggested removing `term-window-width' and instead use `window-max-chars-per-line', as both functions use a complex algorithm to determine whether or not a column is reserved for the continuation character. Well, since I wrote the suggestion, a bug was found and fixed in `window-max-chars-per-line' while the bug still remains in `term-window-width'...
-- Anders