function MemoryStreamToString(M: TMemoryStream): string;
begin
SetString(Result, M.Memory, M.Size div SizeOf(Char));
end;
That works in all Delphi versions, not just Delphi 2009. It works when the stream is empty without any special case. SetString is an under-appreciated function.
If the contents of your stream aren't changing to Unicode with your switch to Delphi 2009, then you should use this function instead:
function MemoryStreamToString(M: TMemoryStream): AnsiString;
begin
SetString(Result, M.Memory, M.Size);
end;
That's equivalent to your original code, but skips the special cases.