The Vim Multibyte Char Search plugin enhances Obsidian's version control and file recovery features by displaying diffs for Sync, File Recovery, and Git versions of the active file. It provides a visual comparison of changes with support for markdown and plain text renderings, enabling users to review and restore previous file versions with ease. The plugin integrates with Obsidian Git for version history and includes a color-blind mode for better accessibility. Users can overwrite the current file with an earlier version and view the diffs in a side-by-side format for better clarity. It's a powerful tool for managing version history and ensuring that users can recover files and track changes effectively.