Hi Manjit ,
normally on the server you should not change the character set of the database, this setting is set during database creation. Character settings may change when you migrate from one version to a newer when as part of the migration process.
You can also change the character set by recreating the database and using export/import.
On the client you can change the setting and test it. From US7ASII to WE8MSWIN1252 – there should be no problem, however always test this kind of a change, everything depends on the characters you store in your database. Start an SQLPLUS session (use the sqlplusw.exe, not the DOS version) and create a sample table. Copy some data from another table and run an UPDATE clause. Use the characters you do not want do be corrupted.
Apart from that from an Oracle upgrade document you will read:
Starting in Oracle 9i the National Characterset (NLS_NCHAR_CHARACTERSET) will be limited to UTF8 and AL16UTF16. Any other NLS_NCHAR_CHARACTERSET will no longer be supported.
So check with your vendor if they are sure what you need to do.
I hope this helps,