Make sure your locale settings are correct. Put this minimal set in ~/.xinitrc and/or ~/.xsession (for Greek):
export LANG=el_GR.UTF-8
export LC_CTYPE="$LANG"
export LC_ALL=""
Then make sure your terminal emulator uses those locale settings. For xterm, simply run it with the -lc flag, or by setting XTerm*locale: true in ~/.Xresources.
For the erase/del key issue: if you have a standard keyboard/layout (US-105 keys), then everything should just work. If you have a non-US keyboard, then you'll have to set the correct keyboard map using XkbModel/XkbLayout in xorg.conf, or using setxkbmap, or your desktop's keyboard config. tool.
As a quick check, what does this show in xterm:
$ stty
speed 38400 baud;
lflags: echoe echok echoke echoctl pendin
iflags: -ixany -imaxbel -brkint
oflags: onocr onlret
cflags: cs8 parenb
eol2 erase
^@ ^H
$
As you can see, my erase character is set to ^H (CTRL-H) which is also what the backspace key produces on a US keyboard layout (you can check this in bash by typing CTRL-V, then a backspace at the command prompt).
As for the DEL key, what that does is usually set in terminal emulator.
