I haven't changed the on board regulator or modified the MEGA. When working with the 5" display via USB I have it connected to a powered USB hub. This way the computer isn't trying to supply the power via the USB port. Some computer USB ports balk with a heavy load like the those large TFT displays.
When I put the project into the real world applications, I use a number of different ways to power it, depending on the situation. The most used way is with an ac/dc adaptor (9-12VDC wall wart, 1A), a bridge rectifier, and a dc/dc buck converter connected to the DC power plug on the Arduino.
The bridge rectifier ensures that polarity doesn't matter for the adaptor, the buck converter drops what ever the input voltage is down to 7.5VDC for the Arduino. If you take 9 or 12V and feed the DC jack on the Arduino, anything over 7.5 causes the on board reg to dissipate the extra voltage in heat.
Alternately I've used the AC/DC adapters that have a USB jack on them. I then just use a standard USB host cable to connect it to the Arduino's USB port.
For the text issue, or lack thereof, there are two TFT demo's. One shows a lot of graphics, whereas the other one access the text from the Font_IC and shows it. So, two different libraries and demos. The library for text examples is UTFT_CTE, the sketch is called CTE50_800x480.