"Yes, I eat bread."
Translation:Tak, jem chleb.
Because we don't teach this word and no one suggested such an option before ;) Added, because it's good.
Although "Yes, I do eat bread" would fit even better for "owszem".
No. You cannot translate the construction of Present Continous so literally, because it does not make absolutely any sense in Polish. You basically just wrote "I am I eat bread".