It's been quite a few years since I looked at the game.
I remember having to install some kind of japanese language support in order to get the game to run. When you install the game, you have to enter a serial number that is printed in the manual. It should be intuitive to find it.
As for the typing game itself...yes the game is setup to type in japanese text. However, there are basic text files in one of the game folders that you can manually edit. They serve as word banks for the game. You can replace all of the japanese text with english text of your own. If you are really patient, you can enter in tons of words...or you can just throw in random text of similar length to the japanese text that you are replacing.
The game is very similar to the USA game TYPING OF THE DEAD, which is a great typing game! It is an adaptation of the arcade shooter House of the Dead...except you type to kill your targets as opposed to shooting them with a gun. You can probably download the full game from an abandonware site or from a torrent if you look for it...it is no longer commercially available.
The Macross typing game works in a similar way...you fly through the stage and you have some sort of limited control of your fighter. I believe you can transform at will as well, but most of your flight path is fixed.
You'll see targets, and you destroy them by typing the word that appears next to them. Your gunpod and missiles will be firing with each keystroke, which each correct type is a "hit" and misses for incorrect strokes. I specifically remember swarms of missiles fired at me, with only a single letter marking each missile while I had to frantically type all those letters to shoot them down.
The game has some good appeal, but I wouldn't spend a lot of money on it. It's been years, so I don't remember any specifics, but you should have zero problem finding the text file that serve as the word banks. No patch is needed.
Although the interface and language is in japanese, you should have minimal problem navigating the game.