OK, I have the files and have started working on the English for you to get a feel for where things are on these translations. There are five main problems right now with the text as-is: (1) way too many words or too long of words when fewer and/or shorter words would capture it to display in the same character space; (2) incorrect verb tenses; (3) incorrect subject-verb agreement; (4) missing prepositions; and, (5) awkward grammatical structure or capitalization.
To resolve these, I will: (1) re-translate manually anything too verbose or using an exceptionally long word; (2) correct verb tenses for the situation described using the game scripts for the Apple II and NES as references; (3) correct subject-verb agreement for the situation described using the game scripts as mentioned for (2); (4) add prepositions as needed with preference for generic, shorter prepositions to save space except where longer prepositions will clearly change meaning; and, (5) conform grammar and capitalization to expected English standards in each situation from the player perspective.
Following these conventions, I should be able to keep translations at the same character length or less you have now in most cases. Do you have a limit for the respective files as to how much text can fit so I know if there are cases in which I'll need to be more or less aggressive in shortening the number of characters to fit properly? For example, in the "interaction" screenshot you provided showing the man in a leather apron: it appears the character limit for this would be 120 characters with 30 characters per line. If all of the text boxes besides items/spells/monsters need to be 30 characters per line (...possibly in a 2 line set of 60 total characters with the second line always indented by a space if I'm understanding you correctly?) and 120 total characters per text box, I should easily be able to work with that.
Once you let me know this is acceptable for me to proceed, I can re-pack the same way and keep the separate files as given to return to you an updated ZIP package.
As for the names of both items and monsters, if you don't want to modify the UI at all: then, it looks like you've got 12 characters available for both item and monster names. However, looking at the "main" screenshots where "status" is displayed, it is clear that in some cases the original designers already left only a single-wide border in between instead of a double-wide border while always preserving borders all around the outside of the screen. Therefore, if you wanted to extend the UI for monsters and items one tile over to the left to eliminate the double border in the interface there, it would still have a one tile border between it and the main or combat interfaces and yet allow for one additional character space for a 13 character limit while still maintaining the existing designer aesthetics. This would be much easier to conform everything to what you seem to be wanting.
So for items, it looks like you've got 12 or 13 characters to work with and I believe using the Apple II and NES versions of this game and MM2-3 SNES versions of the games as references I can conform all item names to 12 or 13 characters by using the naming conventions of these games. Does that sound acceptable and can you confirm if you'd prefer 12 or 13? Once you've determined what's acceptable, do you have the list of items in the order they appear in the code for this version of the game for me to present back to you? As an aside, some item names already translated may just need some touch up, but are otherwise OK to fit in the 12 or 13 characters (for instance, in the screenshot of item names you have "DRAGONS TOOT" when in the same space "DRAGON TOOTH" would be the preferred description as it is already implied possessive and TOOT is something entirely different in English, while with 13 characters this would be a non-issue beyond there being no apostrophe in "DRAGONS" as "DRAGONS TOOTH" would be displayed).
One simplification for character space in item names that is a common theme in the game would be to make the "+" sign smaller and put it to the top right of the space of that character cell in the font tile character for that sign to eliminate the need for a full extra character space and then also a full space for just a "+" sign. Another simplification to fit everything in even less characters could be to use lower case letters after the first in the item names, and eliminate the extra character space. With both space-saving modifications, "SPLINT MAIL +3" would then become "SplintMail+3" with the lower and upper cases forming an inherent divide in the words and the "+" shifted to the top right and made smaller in the tile inherently inferring a space between the "l" in "Mail" and the "+3" after it. This would prevent having to use abbreviations like "SPLINT ML +3" in such a case or renaming it entirely. Assuming the lower case letters take up slightly less space in each tile than the upper case versions, this would include an inherent space inferred between the "t" and "M" in such a case as well without the need for a full character space.
As for monster names, since we have 12 or 13 characters to work with as well: I think I'd be able to do the same for those. Again, I'd need to know if the same methodology used for items above would be alright with the monster naming conventions for you? In addition, do you have the monster names in the order they appear in code for this version of the game for me to provide back to you in that same order?
For the spell names, I do not see a reference in your screenshots for how long those should be? Can you please clarify what you are dealing with right now in consideration of the spell name character limit you would like to use (i.e.: what the spell selection menus look like in and out of battle)?
In addition, getting back to the status display, it honestly does not look too bad to clean up. This looks pretty much like the mini-menus in the NES version with the same information. I'm not sure time spent re-doing the whole status menu would be worth it versus just fixing the spacing and changing some of the abbreviations.