I'm willing to give artistic license to that, although I do wonder how the translator knows to stop when someone chooses to speak in the same language.....when Picard swears in Klingon, how does the translator know not to translate that? How does the Klingon know he switched to Klingonese for that phrase?
Curses are an interesting case, because they often don't make much sense in translation. However, I believe that there may two other factors at play, too:
1. They're speaking Federation Standard
According to
The Klingon Dictionary, members of the Klingon aristocracy speak excellent Engl... I mean,
Federation Standard, and it is considered a mark of a good education (just as French has long been among English-speakers, even during the Napoleonic wars).
In my head canon, the heads of most Great Houses would be proficient in FedStandard, in part due to their privileged education and in part because it is a valuable tool for leaders to have; it shows respect for the Empire's most honored ally and allows Klingon leaders to choose their words carefully, thereby giving them an advantage in diplomacy. Furthermore, it will help them to know their enemy when the peace inevitably ends.
Similarly, I would expect that captains stationed along the Klin-Fed border would speak at least decent Fedstandanto, and likewise those who took Doaege Rihanai 101 at the Academy would be favored for positions near the border with the Romulan Star Empire.
Therefore, when we see Starfleet officers interacting with Klingons, most of them are speaking Federation Standard 98% of the time, with only a handful of actual Klingonese words and expressions.
2. The universal translator's "detect language feature" lags behind
Try pasting the following text into Google Translate and set it to "Detect language":
Du är som ett tandlöst gammalt lodjur, som försöker skrämma oss med sitt vrål! Vi får väl se. Heute ist ein guter Tag zum Sterben!
You'll notice that GT translates the first two sentences quite well, but fails to make sense of the final sentence. That's because the first two are in Swedish, whereas the final sentence is German.
Specifically, this text is modeled on the conversation between Gowron and the DS9 crew towards the end of
The Way of the Warrior. They say a bunch of things back and forth, and then Gowron says something in some Klingon language. The DS9 crew all turn to Worf, who explains: "He said, 'Today is a good day to die.'"
It is my sincerely held head canon that the reason the UT failed to translate the final sentence because, just like Google Translate, it was translating (or rather, abstaining from translating) the bulk of the conversation and thus wasn't set to translate Klingon.
Of course, 24th century translation technology has been shown to be far more advanced than it is now (as it should be), but one might still imagine there is some sort of "linguistic inertia", where the UT will remain set to one language it adapts to another.
Considering how the UT has been shown to be more or less magical, translating languages it's only heard a few sentences in, it's not unreasonable to think that this might be a conscious design feature, rather than a flaw. If you're a spy eavesdropping on a conversation, you might have your UT set to "Inertia OFF", so that the UT will switch languages at a moment's notice and let you hear every juicy detail in a language you understand.
However, in day-to-day situations, this might be impractical; just imagine this scenario:
"Captain, what's the French word for 'mushroom'."
"'Mushroom'."
"Oh, so it's the same as in English?"
"No, it's 'mushroom'."
"Right, so 'mushroom' is also the French word for 'mushroom'."
Picard lets off the most vile series of profanity that Riker has ever heard.
"C... Captain!"
"Forgive me, Number One, it's an old French... Oh, I see. Computer! Adjust Commander Riker's Universal Translator settings; Inertia ON!"
"Affirmative"
"Number One, the French word for 'mushroom' is 'champignon'."
What I always found odd was when you have Worf or whoever use a Klingon word or term untranslated, and then he or someone else translates it. Like in one briefing on DS9 Worf was talking about Gowron's protection service, which he identifies as "the Yanis'leth" and Dax then provides the translation "Brotherhood of the Sword." Why didn't the UT just provide "Brotherhood of the Sword" when Worf said "Yanis'leth" to begin with?
I suspect this situation could be explained using the same explanation as the one above (you can try feeding GT the mostly-English sentence
"He is guarded around the clock by his personal security force, die Bruderschaft des Schwertes." and see how it fares), but I believe there might be another explanation as well:
Because the Federation has known about the existence of the Yan-Isleth for a long time, the name is listed as a proper in Federation databases. As such, the UT does not deem it necessary to translate it, any more than it considers it necessary to refer to the station's CMO as "Dr. Jupiter's Bringer of Good News".
Real world examples of organization names that often go untranslated include
Médecins Sans Frontières ("Doctors Without Borders", which they also go by),
Knesset ("the gathering") and
Luftwaffe ("the air force").
Another interesting example is
Gardes de la Manche ("Guards of the Sleeve"), which was the King of France's personal guard for many centuries. Seeing as they filled a function similar to that of the Yan-Isleth, it's not unreasonable to think that the latter is also referred to by its native name.
Who knows.
