I've been in japan with other "redneck" americans, and I've seen their discomfort in situations they didn't understand at all, and I've see them act the same way, covering up confusion and fear with blustering humor. I've seen others mistakenly ignore cultural differences and try to treat their hosts like americans, to everyone's detriment.
Personally, I look for the differences in culture, and study the different points of view. The Asian Wall Street Journal is so fascinating because its coverage so different. There's a whole nother world out there, and we kid ourselves in the US that we're plugged into it.
Anyways, the story is about going somewhere and being struck with an unexpected sense of foreigness. Are the japanese over the top? Sure, but its all about making the experience just so "foreign" for american viewers. The joke about the director talking for ten minutes and then the english translation being three words is a gag as old as the hills (actually came from english dubs of chinese kung-fu movies).
I remember when Disney came about with Pocahontas, and the native americans were complaining that it wasn't historically accurate. Mel Gibson responded with the question "what level of realism should we really be striving for in a cartoon with a talking tree?"
Joi mentioned that a lot of scenes take place in obscure locales that most japanese would ever know about/see. But that's what Hollywood does, is amplify the unique (when its not out-right inventing a fantasy).
Anyways, as I commented over there; life is seldom portrayed accurately in hollywood films. While there's some little truths in LIT (like the part about how children change your life), in general its a film, and its views are the views the story teller created to tell the story.