The Javascript on the admi18n pages (language_management in particular) is broken. Clicking on "Compile selected locales/Merge strings" has no effect; neither does clicking on any of the message id/message string boxes on the translation page, for this matter.
I tracked down the problem to Javascript syntax errors in the for loops of the type:
for(var i=0;i < elements.length;i++)
This looks like the old problem of Kid escaping "<" inside CDATA elements. So, it seems that the easiest way to fix this would be to move the Javascript code out of the template and into an external file.
What I don't understand, though, is how this could ever have worked. It did when I used TurboGears 1.0.1.