Substitution is conceptually a destructive operation, particularly on structures, and that is how you use it, so I would rewrite your unwrap_cdata as explicitly so:

use strict;
use warnings;
use Data::Dumper;

my $var = '<Country>&lt;![CDATA[US]]&gt;</Country>';
unwrap_cdata($var);
print $var."\n";

my $hash = { america => '<Country>&lt;![CDATA[US]]&gt;</Country>',
             europe => ['<Country>&lt;![CDATA[IT]]&gt;</Country>','<Co
+untry>&lt;![CDATA[UK]]&gt;</Country>'],
           };

print Dumper $hash;

unwrap_cdata($hash);

print Dumper $hash;
[download]

If you ever really want to make copies, pass the copies to unwrap_cdata instead, and make sure you make deep copies (like with Storable::dclone).

And now for my trick:

sub unwrap_cdata {
  for (@_) {
    eval { unwrap_cdata(@$_); 1 } and next;
    eval { unwrap_cdata(values %$_); 1 } and next;
    s/<!\[CDATA\[//;
    s/&lt;!\[CDATA\[//;
    s/]]>//;
    s/]]&gt;//;
  }
}
[download]

Recursion is fun. Block eval is great fun. :-)