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Titles: The Ghost of Maiden's Peak/ゆうれいポケモンとなつまつり/Pokémon Ghosts and the Summer Festival
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I didn't think the English dub did that bad a job of this episode. There were a lot of little things here and there but nothing that overly affected the overall episode which would be considered a critical translation error.

Dub Edits: http://www.pocketmonsters.net/episodes/20#Edits

Summary:
Satoshi and friends are currently on their way to Yamabuki City. Having left Aopulco Island, they've finally arrived at a port town, which is in the middle of a summer festival. Satoshi's group joins in on the festival fun to relax after their journey, and Musashi and Kojiro from the Rocket Gang join in as well to make a bit of money.

Both Takeshi and Kojiro get fascinated by a picture scroll kept as a treasure in the local shrine, which gets displayed on the day of the festival. It's a picture of the beautiful girl from the legend of the "Maiden Rock" located at the nearby cape. According to the priest, the picture depicts a maiden who turned into a rock and died as she waited for her lover who had been caught on the battlefield, 2000 years ago. Every year at this time, the ghost of this maiden steals the soul of traveling men who visit. Takeshi and Kojiro both end up possessed by the maiden's ghost. What is the ghost's true goal? And what is its true identity......?

Voice Cast:
Rica Matsumoto: Satoshi
Ikue Ohtani: Pikachu
Mayumi Iizuka: Kasumi
Yuji Ueda: Takeshi
Megumi Hayashibara: Musashi
Shinichiro Miki: Kojiro
Inuko Inuyama: Nyarth
Takko Ishimori: Old Hag
Ayako Shiraishi: Joy
Chinami Nishimura: Junsa
Rikako Aikawa: Zenigame
Michiko Neya: Maiden
Katsuyuki Konishi: Priest
Unsho Ishizuka: Narration