My questions:
1. Under which resolution should I test translations? Do we agree that 1024 x 768 is most common and everything should fit under this setting or we go lower to 800 x 600 ?
Wikipdia states the most common display resolution is currently 1366x768, but I think it's good to support 800x600 because of small / mobile devices especially now that Softcoder is experimenting with ARMs (but not weapons). The more important factor may be the aspect ratio, though, since thhis can actually cause text to cross boundaries on one screen but not on others. So it would be good to test both on 4:3 and on 16:9 where this is an option.
2. What does "Disable Lua Script Security Sandbox" mean? (meaning what really i disable here? script? sandbox? security?)
By ticking this option, you disable some safeguards which prevent some attacks against the Lua scripting engine embedded in the game. This engine is used to interpret script code found in scenarios.
2a. Why after selecting it the warning window says what happens if I enable them?
We had to make a last minute change there. The English source is correct on Transifex.
3. What does "Max lights" setting in options menu refer to? (Maximum number of sources of light? Maximum strength or the lights?)
I think this is the maximum number of light sources.
4. Key "String ID: SavedGameBadVersion" in english is "saved game version does match your application version: [%s] --> [%s]" but it should say "does NOT match" right?
I think you are perfectly right there and have fixed it in the subversion repository. This should propagate to Transifex within the hour.