Tested on an MM3-modded PSone model SCPH-101 (manufactured august 2004 with motherboard PM-41(2) ). apparently there is an issue where the text does not show up properly. Perhaps on some newer models the hardware revisions may have caused this?
Hmmm, that's interesting and odd at the same time. Could be the case. It appears like incorrect texture mapping, since the text is drawn using a technique similar to the level itself.
Out of curiosity, what happens when with the text when you enable debug mode on level select? Specifically, the text within the upper semitransparent square up there: