I am using micro metal gear motors and the Pololu 3081 magnetic encoder on them. My motors are being driven at 5V. Should I also use 5V as the Vcc of the encoder, or is it safe to put this on 3.3V? I want to read the results using a 3.3V microcontroller.
Yes, you can use 3.3V to power the encoders through VCC while your motor is being powered through M1 and M2 from a different level supply. As shown in the schematic on the product page, the motor channels, M1 and M2, are completely separate from the encoder circuit.
Awesome, thanks for the fast reply! I thought as much but wanted to be absolutely sure.