Why does Brian never translate what Stewie says?

Because the main characters can hear and understand him anyway so there is no point.

Can all the characters hear Stewie when he talks?

The single most asked question about the show. They can, they can hear him and understand him, its just that he's a baby and for that reason they just don't take what he says with any seriousness.

So it's just funny that he wants to kill Lois?

Yeah, the best analogy I can come up with....there was an incident where my cousin's 4 year old son was leaving our house and he turned to my mother and said, "I'll see you in Hell." No one really knew where he picked that up, but everyone was laughing their asses off because here was this 4 year old telling my mother he would see her in hell.

He probably got it from TV!

He probably did. So basically, if you look at it like that, let's say hypothetically the kid was deadly serious, which Stewie was, people would still say, "Oh, isn't that cute." So they can understand him, they just didn't take it seriously.

_{TV Shows on DVD, Interview with Seth MacFarlane}

Of course this interview is from 2003 and Family Guy isn't exactly known for sticking to its own canon especially for the sake of the joke so this could change if it suits them.

It's worth noting though that not all the characters always hear him so whilst they may understand what he says they don't actually hear it to respond anyway. This is mentioned on Wikipedia here but the source link is to a YouTube video that has been taken down.

However at the 2011 ComicCon panel, he compared this to Wile E. Coyote in the old Merrie Melodies cartoons. MacFarlane went on to say that Brian always hears Stewie, and more recently so does Chris, but the writers usually strive for Peter, Lois, and Meg not to hear him. Once Stewie leaves the house, the question of who can hear him depends very much on the story. MacFarlane also states that these rules can be broken for the sake of comedy, so this could change from one episode to another.

I agree with TheLethalCarrot mostly. But I think what happened was for the first couple of series the gag was they couldn't understand him. But as the show went on the writers changed it to them ignoring him.

He's a lot more homicidal towards Lois in the early series and they slowly phased out that joke later on.

I'd guess Brian doesn't tell the family since he doesn't take Stewie seriously. If he did no doubt he would tell the family since he's obsessed with Lois.

Actually this is directly answered in the episode where Quagmire has an affair with Loretta, Cleveland's ex wife. There's a scene where stewie is asking Brian if Loretta will be able to understand him. and Brian says "I think she's close enough to the main cast where she will only get the gist of what you are saying". Loretta later answers stewie with "well I get the gist of what you're saying Stewie".

There are several examples like Stewie asking peter to out his hand on the toilet to potty train and peter understands, or when Stewie and peter are bonding over tormenting Lois and peter answers Stewie with "I think we better quit, she seems pretty mad".

Any character outside the main cast can understand Stewie perfectly. Anyone in the main cast or close to it (like Loretta) only understand the gist of what he is saying, with the exception of Brian. They know if he wants something like food or a kiss, presents, etc. but can't hear all the details why, almost like a real baby or toddler trying to communicate and the parents get the gist.

As far as Brian not telling anyone. It could be because they wouldn't believe him or it might change his relationship with them. It's also probably a writers' choice to make the show more interesting.

I think I read somewhere where Brian wasn't supposed to be able to talk either, and could only communicate with Stewie. As for the rest of the family, they're not that bright :) Other adults seem to be able to hear and converse with Stewie due to his abnormally high intelligence.