The solution to work the modified kernel.bin is in the forum romxhacking where I have posted my project about the spanish re-translation, the programmer CUE did a tool to extract in pieces the kernel.bin, I would like the creator of the wall market, includes this as solution or future updates.
The forum where about the topic is here:
http://romxhack.esforos.com/traduccion-o-retraduccion-final-fantasy-vii-psx-t372-30You must download this tool, if you use it, plese put in the credits to CUE, thanks.
http://www.mediafire.com/?df9mmfp205n69qa YOu can put inside that folder, the modified kernel and yamaha.bin, you must click on in decode.bat,
then you will get 27 files, but the most important are from 9 until 26, you can also be used to split files with wallmarket.
Then, you must check the size of the all archives, if the size of the archive the last number is uneven, you must modify that archive with hexecimal editor and add to the last that archive FF, to convert it in Even number, because the psx original doesn't read uneven bytes in the archives.
When you finish compress again the pieces of kernel with the Wallamarket or CUE's tool.