In order to use the character editor, follow these directions.

1) Open up database_D in 'Nightmare.exe'. If you don't have this file, then learn how
to decompile your ROM, obtain it from data/data in the unpacked NDS ROM, and then take
the file "database" from there, copying it to the editor's folder. You must then decompress
this file using Nintenlord's Compressor (use the LZ77 DLL to decompress the LZ77 data).
The output file is the file you need (I usually name this file database_D,
where the suffix "D" stands for decompressed).
2) Open up the character editing module with nightmare.
3) Edit what you want, hit enter after making changes to a character, and after you are all done,
hit ctrl+s to save.
4) Use NLZ77 Compressor and recompress the files following the tutorial included with it.
Thanks to Nintenlord for the program as usual. :P
5) Put the file "database" in the "data" folder of your decompiled NDS ROM. Make your edited file replace the old one so that the new changes replace the old data.
6)Recompile the ROM using DSLazy or another program of your choice.
7) Test the game to see if your changes work. 

Contact at smashfire17@gmail.com or http://www.feshrine.net for help and more info.