OK, by debugging the editor I figured out that it wants the .ini to identify the PARENT folder containing the seperate culture folders:
WRONG:
[Internationalization]
+LocalizationPaths=%GAMEDIR%Content/Localization/Game/en-GB
+LocalizationPaths=%GAMEDIR%Content/Localization/Game/fr-FR
+LocalizationPaths=%GAMEDIR%Content/Localization/Game/de-DE
RIGHT:
[Internationalization]
+LocalizationPaths=%GAMEDIR%Content/Localization/Game