In general, the DropDownList widget is designed to filter the items based on the defined dataTextField option. In your configuration it is the "key" field, which means that the widget will search in the key
Unfortunately, the widget is not aware what is happening in the defined templates, as they are out of its control. That being said, it would not be able to search in the output of the defined templates, as they are formatted text that the widget does not work with.
I am afraid that there is no workaround that I can suggest in this case. The only solution that I can think of is to actually bind the widget with the translated text, defined in the translation provider. Basically, you can construct JSON that contains "key" and "text" fields and the widget will search in "text" fields of the provided data.
Join us on our journey to create the world's most complete HTML 5 UI Framework - download Kendo UI