entrancey,
Your problem seems to be language-related. Please copy and paste the additional language elements from the language file in the hack to your default language file.
Stephan,
Upgrading to VM 1.0.14 will definitely break many customizations. While I have a way that may help alleviate this upgrade problem, I'm not sure whether this will work. If you are comfortable in taking some risk (of course you need to backup your files), you may try replacing the file admin.virtuemart.php (in the administrator/components/com_virtuemart directory) with the attachment.
Azzam,
By digital products, I guess you mean downloadable products. I have no documentation how downloadable products are configured. But you may try to see this works:
In your excel file, add the attribute_values column (if it's not already there). Put download::filename for the product you want to set as downloadable. (filename should be replaced with the file path in your root download directory). Let us know if this works.
[attachment cleanup by admin]