I have had a little chance to investigate this more on my dev/test system.
On a fresh install, you place language files in the following locations:
When, I do an SVN update in accordance with your instructions only the following language locations are updated:
If I copy out these new language files in these 'component' directories and place them in their appropriate language directory (admin or site) then I no longer get the language string problem.
Note: I still had to copy JEV_DESCRIPTION string from the site language file to the admin language file for the Manage Categories : JEV_DESCRIPTION display issue to go away.