[mikemaccana]

See https://github.com/PowerShell/Win32-OpenSSH/issues/57.

For some reason putty works but iTerm has the backspace issue. Putty user: what's your $TERM?

Ctrl H works as a workaround BTW.

[voltagex_]

$TERM from PuTTY - xterm $TERM from Terminal.app - xterm-256color