Can we pray Taraweeh or Night prayers while holding the Quran and reading from it? And can a person who does not understand Arabic praying Taraweeh behind the Imam hold the translation of the Quran to follow the Imam’s recitation so they can understand?

Yes, it is permissible to do so while praying optional prayers based on the following evidence:

Prophet (peace and blessings of Allah be upon him) led the people in prayer while he was holding Umamah, his daughter’s daughter.
(Narrated by Al-Bukhaari, 494 and Muslim, 543)

`Aishah (may Allah be pleased with her) had a slave who used to lead her in prayer in Ramadan, reading from the Quran.
(Narrated by Al-Bukhaari in a mu’allaq report, 1/245)

Al-Nawawi (may Allah have mercy on him)said:
“If he reads from the Quran, that does not invalidate his prayer, whether he memorizes it or not. Rather, he should do that if he has not memorized Al-Fatihah, and if he turns the pages sometimes while praying, that does not invalidate his prayer. … This is our view and the view of Malik, Abu Yusuf, Muhammad, and Ahmad.” (Al-Majmu’, 4/27)

Sahnon (may Allah have mercy on him)said: “Malik said: There is nothing wrong with the Imam leading the people (in prayer) while reading from the Quran in Ramadan and in Nafl prayers.

Ibn Al-Qasim (may Allah have mercy on him)said: “That is makruh (disliked) in the case of obligatory prayers.” (Al-Mudawwanah, 1/224)