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So for clarification, if we offer the game in two languages and each version is 1000 words each, that wouldn't be allowed because it's 2000 words total? Or are multiple languages allowed as long as each translation is under 1000 words?

The ruling about the 1k words is about crafting a "short but whole" story. So in that vein it does make sense that  if a game is translated into several languages, each of those are 1k words (or less) each.