Your changes do not convert escaped newlines to multiline strings, but convert single line strings to multiline strings by wrapping them at some arbitrary limit. For example, the first change in your diff breaks "Unsafe browser string. See snownews.kcore.de", splitting it just after "See ". If I understand the new gettext recommendation correctly, that would create a line break there, preventing gettext from matching the original single line string. You can't see it, of course, just by running msgfmt,...
Running configure errors out
Closing "wontfix". Will later consider revising supported OS list.
It appears that your shell is being overly aggressive in unescaping the slashes in the string that builds config.sed. I am /extremely/ wary of messing with string escaping, since this has previously been a recurring problem on various platforms. The current code has been tested and worked on BSD previously (FreeBSD), and it does work when using dash, which is the only ksh equivalent I have access to. Since I am not able to repeat the extensive testing required to verify that any proposed fixes would...
po/sr.po: Update translator's email address
I've done the email change manually. Commit 351dd7ebbb81109a090c5d90c3817c4f44278c08.
Update Serbian translator's email
Please attach the failing config.sed. I am not able to reproduce the error when running the specified command. Calling escpath the way you do is not appropriate; it is supposed to take the unescaped path as the argument.