Yep, so I assumed it might've been a setup file problem - if you have the game installed and other mods like Xan's friendship or whatever get installed on your BG1 installation, then it might be a typo in .tp2. I thought I'd look, but Language flags seem correct there(since it's stuck at language, I assume it seems to be the problem).
You might try opening your .tp2 file in your bg1ub directory and deleting
LANGUAGE ~Deutsch~ // Timothy
~tra/Deutsch~
~bg1ub/tra/Deutsch/setup.tra~
LANGUAGE ~Espaсol~ // Immortality (clandlan.net)
~tra/Espanol~
~bg1ub/tra/Espanol/setup.tra~
LANGUAGE ~Franзais~ // IronFistedGiant, Isaya
~tra/Francais~
~bg1ub/tra/Francais/setup.tra~
LANGUAGE ~Italiano~ // Andrea Colombo, Stone Angel, ilot
~tra/Italiano~
~bg1ub/tra/Italiano/setup.tra~
LANGUAGE ~ђгббЄЁ© (Russian)~ // by aerie.ru & Darktech + arcanecoast.ru team
~tra/Russian~
~bg1ub/tra/Russian/setup.tra~
LANGUAGE ~Polish~ // Bartek
~tra/Polish~
~bg1ub/tra/Polish/setup.tra~
(leave ~English~ LANGUAGE flag) and then running the setup again, but I'd say your best bet is waiting for someone more knowledgeable to answer.