Does that mean that the script in this game is compressed?
Not necessarily. I don't really know as I've not done much with this game before.
What does it mean to dump the script?
In this case, it means using a tool such as Cartographer: http://www.romhacking.net/utilities/647/
If you have a complete table file, and you've identified crucial information such as where the text pointers are located, control codes, etc., it can be relatively simple to dump the script to a text file for easy editing and then to insert the script with the changes.
I've found it's helpful to dump the script and then try reinserting without changes to verify everything is working correctly before moving forward with any edits.
To reinsert the script after you've made the edits, you would use a tool like Atlas: http://www.romhacking.net/utilities/224/
I've rarely used these tools because I like to create my own, so I cant really be of much more help with these tools specifically, but check the readme files.
Edit: I'm operating under the assumption that the other character names are hard-coded into the script. But hopefully what I've written points you in the right direction.