Yes, it does use the internet. Blocking its access through a firewall breaks it. I would definitely switch to an on-device translation app. If Bixby can work offline I see no reason a translator couldnt.

Translations were workinga month or 2 ago on the non playstore version. I installed via F-Droid/Izzy on my non-Google Android and they worked perfectly. Why was the feature removed from the non Play version?

It should be back on 0.58. aren't they working for you?