Most of the problem lies with Japanese phonetics. For most of the actual Japanese words they render in kanji (characters), which stand for concepts not pronounciation. But most of the place and character names in FFVI are borrowed words, which they would render in kana, a phonetical alphabet. Going by pronunciation alone, it's hard for a translator to guess what the original author meant to say.

And there is ambiguity in how a particular sound translates, most famously 'L' and 'R'. The FFIV summoner could be read out loud as 'Rydia' or 'Lydia' and most Japansese would not pick up on the distinction. It's interesting that the English translator went with 'Rydia' since 'Lydia' is an actual woman's name.

I've heard at least one instance where the translator deliberately altered a translation to make it less controversial: 'Lethe' river into 'Lete'.