Games can be fun, but really you want to be doing contextual reading with them (
ESL Reading Lesson - Using Context for Reading Literacy - this is about English but applies generally to any foreign language learning).
If you sit there trying to understand every bit of speech - let alone translate it into something resembling natural English - you'll never finish the game. Also, you can't trust that the English version literally translates the Japanese; in your example, the English version drops "村のおきて" (probably because a direct translation would be too clunky; they might also have character limits to stick to or something).
A good word to know for anybody who is interested in games: 攻略, or walkthrough. Instead of trying to play the game and translate as you go, google the Japanese name of the game + 攻略 (should get you to a site like this:
聖剣伝説2 攻略 ). Then use that to learn the basic vocabulary - it's easier via that way as you can copy/paste - and look up things you need help with. Explanations in the walkthrough sites also have the advantage of generally being written in more straightforward language compared to dialogue. You'll still need to study, but a site like that will make better practice material then the game itself.
When you play the game, just play. Don't worry about the meaning of every little thing, do make a mental note if there's a word or phrase that makes you think "if I knew what that meant then everything else would make a lot more sense" or "I keep seeing that word, what did it mean again?".
If you're really patient, you could always play the game through in English (so you know the story and generally how things go), and then have a go at it in Japanese.
The good news is that if you play several games in the same genre, then you'll find a lot of repeating vocab. There's only so many ways to say "attack" "defend" "heal" and "you can't get to RandomVille until somebody fixes that bridge".