Does it matter? They pass through Google's servers; results of analyzing them are stored on Google's servers; the full audio is probably stored on the NSA's servers; if Google says they don't store the full text, does that meaningfully alter the level of privacy you can expect?

With Google Translate, you can use the service offline by downloading language packs. Now, I'd assume that if you use it offline, Google will cache your conversations and upload them the next time your device has connectivity. But who knows.

If they do, they'll likely surface it here and let you delete it: https://myactivity.google.com

Not only will your conversation be recorded; you won't even be able to have conversations about forbidden subjects. Not necessarily illegal subjects; just forbidden subjects.