How will you spcify the charset in the HTML page ?

You can provide the charset information in the head section section using meta tag.
E.g.
<META HTTP-EQUIV="Content-Type" CONTENT="text/html; charset=SHIFT_JIS">

How to change the ENTIRE website from one language to another ?

You are getting into the realm of an interesting subject called "machine translation" We couldnt locate any open source code available in this subject. The technology is evolving and closely linked with the natural language processing (NLP) technology. The translations are not perfect but good enough to understand the context.
You are better off writing a client which will make use of the google or altavista translation features, rather then writing the logic on your own. On a higher level, the logic is usually to parse the input and identify the nouns and verbs and translate and rearrange in the target language.
List of sites maybe of interest to you.. http://w4.systranlinks.com/config
Altavista machine translation
Google machine translation.