Hey there BackSu. What language are you trying to translate into? Kero Blaster only supports a small portion of Shift-JIS (see: rsc_k\img\font.png), which includes (but is certainly not limited to) all alphanumeric characters and Japanese kana, as well as a handful of Japanese kanji.
Kero Blaster has native locali(s/z)ation support. If you go to rsc_k\localize you can see the language files for the game. There is no simple way to switch to custom languages (that I know of), however, so you'd be best advised to backup the English/Japanese translation and then edit those. (to switch from Japanese to English, place a file labelled 'english' in the rsc_k folder, non-case-sensitive)
The text is broken because the game uses bitmap fonts (unlike Cave Story, which uses TrueType fonts), and is only designed to use Shift-JIS. (which works fine if you're writing in English, Greek or Japanese, (and maybe sometimes in Chinese too?) but is otherwise useless)
You most likely would not be able to add font files without changing the game's code.
If you're interested in properly translating the game, you could contact Pixel directly and ask politely for him to update the game to give it proper localisation support in the future. Or, if you're a professional (or very competent) translator you could offer to make an official translation for the game.
There is no such file in such a location. There is only font.png.
There are some txt files for mapping characters (i.e. if you open kerofont.txt you can see the order of the characters that appear in kerofont.png). So maybe one could work with that, who knows.That won't work. The likelihood that GB/Big5 or any other encoding system's character codes would line up with Shift-JIS character codes is unlikely. Especially Unicode, which is what most places use now anyway.