I'd like to point out that Erle was notorious for giving mistranslations of Chinese words and terms.
As Gord points out Erle cared more about the market he sold to and less about the proper use of words, like Kata, Dim Mak, fajin etc. He was not the first and won't be the last to do so. It does create some confusion as that a word in the WTBA that is used by many systems often has a meaning or use in the WTBA that comes from how Erle used it, and does not mean the same thing in his system that it does in Mandarin and or in other systems.
His work is a lot like that of Count Dante, in that regard.
Pete, I think you have a point, I know of many people who throw around Chinese words without any idea what they mean. It is all about mystifying students, like using the term 'ancient masters', it is designed to give an air of mystical meaning.
However in some cases western translations are incredibly poor, this is true for many terms used in CMA. The eight energies of the 13 postures are like this. The term "ward off' for example is unable to convey the meaning of the energy in a meaningful way, not that Peng does either, there is a parallel criticism of the use of the Mandarin word.
My point here is that words are of limited use, in any language, and they require explanation beyond simple words and terms. Often without a physical demonstration that can be felt there is little that can be conveyed or learned with terms of any language. For this reason students of teachers (like Erle and many others) who give mistranslations or misuse terms rarely care about the language issue and care more about the demonstrable context of the term. This results in a sort of martial arts tower of babylon in terms of language paradigm issues, but only in terms of communication between different schools.
What X word means in one system can mean something totally different in another system, this flusters communication at places like this forum where diverse contexts and systems interact and relate.
I don't feel that misusing a word undermines any form of credibility other than historical accuracy and knowledge. On one hand it shows that in terms of tradition and history a person has no clue and does not know what they are talking about, on the other hand it does not mean that they are not martial or credible as a martial artist or system creator.
If you care about historical accuracy then it is an issue, but if all you care about is your own system then it doesn't matter if your teacher has no clue about the true meaning of the terms and words he uses.