I'm not familiar with that game, but I can tell you that, especially on 8-bit consoles like Game Boy,
hacking a Chinese version is probably harder than working on the Japanese original.
Particularly as most/all Japanese GB games tended to use 8x8 kana for text, which is FAR better for English on such a low-resolution screen.
Chinese games (which I think tended to be unofficial translations, I don't know of any GB games which had a licensed Chinese localization. I think they the library of official releases mostly used English ROMs, and the one licensed game I have, Super Chinese Land 3, is binary identical to the JP version) usually modified the fonts to 16x16 to use kanji, but that is, again, way too large and space-wasting for any kind of sensible English translation to fit the screen space.
I think the reason to even consider CH would be if, as Dynamic-Designs originally played to do with Destiny of an Emperor, simply because it would've bypassed font compression in the JP original (which by this point, there's probably enough GB ROM hacking expertise to make that less of a concern).
But, as to actually answer the question...
how a password screen works is that indeed there usually is likely two text tables in the ROM.
One to print the menu text on the screen, and another table to indicate which character is mapped to each possible highlight point on the screen.
(so say, for the first, you might have "A B C D E" because on the screen characters are printed with spaces between to have room for a cursor. And then for the second you would, usually near it, have "ABCDE" to represent that those first five spaces should map to characters A, B, C, D and E.)