Translation devices in fiction always work better than anything we have yet come up with. Translation is a difficult job and the translator needs a good working knowledge of not just the literal meanings of words in two different languages, but also of idiomatic usage, cultural associations, subtle changes of connotation depending on word choice, puns, well-known jokes, and basically almost everything about the cultures that speak the relevant languages. For a machine translator to know and use all of this stuff properly takes computational ability far beyond anything that current technology can manage.

For a science fiction setting, you get the free pass of "advanced technology". In fantasy, you can handwave some magic. In realistic historical or current day settings, you probably need living translators. All of these give you opportunities for roleplaying fun. Technology can break down, magic can stop working for arbitrary reasons.

And living translators bring with them all the complications of people with their own personalities and goals. Translators are normally "invisible people" - assumed to be there just to do this job and melt into the background, where they can easily be ignored. Try making a translator an important character in their own right. They are ideally situated to be spies, for example. Or they can be manipulated by third parties, giving them an insider in the communication channel. Or maybe a translator goes missing, and becomes conspicuous when suddenly communication with the foreign ambassador becomes difficult or impossible. You better track them down and find out what they're up to!

Transcript

Luke: Wait, what's this switch? Droid translator?
[SFX]: klik
R2-D2: Finally!! You have no idea how annoying it is that the makers of this stupid bucket of bolts neglected to have the second most useful element to any droid be the only thing that can't be accessed remotely.
[SFX]: < bip ziting tazz squee boop deep oodoo bebebloop bing-bleep-bedoop boop bleep ezz bippity-bzzt bedoop prow biwhree boop whiree >
R2-D2: What a bunch of glue-gripped, rust-jointed, bantha-brained bucket heads!
[SFX]: < whree whiree-buzz ka-poppy-ezang-zibuzz niding-bop pobuzz zizang >
R2-D2: Why would anyone do that?! What would possibly possess anyone to contrive such a ridiculous arrangement?!
[SFX]: < ping bedoop bleep fi-prow ping dip-deep bebebloop whree >
Luke: I can't imagine.