The \"boxes\" are happening cause you turned on Japanese Input (there is a little squiggly character in a white box) press the Japanese Key next to \"-\" key and the squiggly char should turn into a A (note if its an A in a white box you will still get squiggly lines). Everything you type while the squiggly line is shown will get you boxes, some fields in the adress book and calendar automagically change to Japanese mode, As you changed you local.conf to \"en\" your Zaurus won\'t use the japanese fonts and therefore show boxes instead of japanese characters.
The best way to get rid of the boxes is flash an English only rom or if you want to still be able to enter Japanese you can use my conversion script that will change all the menus to English but allow you to enter/read Japanese.
Stu