Pizzicato 5 are great, very twee (like a lot of Japanese stuff), but fun. Not up to date on Japanese music, but a couple of the bands I've come across over the years/
Mikabomb - on the Damaged Goods label, home to the likes of Holly Golightly, the Headcoatees etc. If you like that kind of DIY punk garage thing, definitely worth checking out. http://www.mikabomb.com/
Ex-Girl - Very strange, fantastic live. Saw them in the Lobby in cork a few years ago. Do the best and weirdest cover of James Browns "Sex Machine" ever. http://profile.myspace.com/index.cfm?fuseaction=user.viewprofile&friendid=56941101
Guitar Wolf - as barkingly mad as the name sounds. Almost a parody of rock and roll but definitely fun. Domo-Kun (google it) likes them
Hanayo does a great electro cover of "Joe Le Taxi", not heard anything else from her to be honest though.
http://www.hanayo.com/
http://profile.myspace.com/index.cfm?fuseaction=user.viewprofile&friendid=72686684
Not Japanese but fronted by a Japanese lead singer -
Asobi Seksu, very MBV - http://www.asobiseksu.com/