It is possibly true, that adapting to modern ways, still presents challenges to Japanese design traditions, and perhaps accounts for some of the disparity between the photograph and the eye you speak of.

I am only aware of this contradiction you speak of through photographs – which is an irony – as I am yet to visit Japan.

Perhaps this conservation ethic in importing and adapting is part of the traditon of aesthetic learning?

Great examples of Japanese design. I sometimes wonder if the country is like Giverny, or some fashion models, in looking much better on photographs than it does to the eye.
Japan is also very interesting as a country which has modernised itself without, entirely, breaking its contacts with Buddhism. I have read some Buddhist literature in the vein of ‘we may not be as wealthy as other countries but our people are much more contented’.
With Japanese culture it is hard to know what was ‘made in Japan’ and what was ‘conserved in Japan’ (as many aspects of Asian culture were imported, adapted and conserved).
The old Japanese toilet looks excellent.

It is underpinned by the zen philosophy, but does not seem traditional in appearance. [ http://www.japanquestjourneys.com/wp-content/uploads/2011/01/Koishikawa-Korakuen-Garden-Tokyo-Japan13CD017S270.jpg ] and [ http://twistedsifter.files.wordpress.com/2013/02/kawachi-fuji-garden-kitakyushu-japan-wisteria-6.jpg ]