broadly speaking that part about not replicating its function is supposed to stop people from allowing their users to use the fonts for commercial use... for example a merch website letting their customers make logos with the font for selling t-shirts, or maybe a graphic design company like Canva or Adobe allowing use of the fonts directly for their users to make designs with etc. etc.
It was never intended to stop you from doing the things you described, where the content is only visible in the game and not commercialised by the player. So in the cases you said I would say feel free to use it. We need to do a pass on the legal language at some point to clarify this stuff properly.