I'm completely stumped by your issues. My hunch is that the files are locked or unwritable. Is there an error.log file in the root StencylWorks directory? If so, that would be great to see.
I unfortunately have no fix at this time, but you can proceed as follows.
- Grab the latest patch of sw.jar and copy it in. This will forcibly get it up to where it needs to be.
- Grab the attached ZIP file and replace your lang directory with it. This will forcibly update all the language phrases.