I believe the labels are contained inside the en resource file found under ..\webserverextensions\www\localized\.
The DISTANCEMILES, DISTANCEKILOMETERS etc are where the values come from. However it appears that the measure.php (or jsp or apsx) page is where the strings are referenced and need to be changed. Ideally an enahancement is needed to allow the user to specify the units to measure in rather than have the pages hardcoded based on the viewer settings. Since users may be using data that is for floorplans or small developments they may not be working in kilometers or miles and hence the measure pages don't accomodate this.
Dave