Actually, they do have cheese. I've had it with many foods at different restaurants, even with more traditional Japanese food. Of course, you can buy it at convenience stores or supermarkets as well.
And out of the three times I've been to Japan, I've rarely smelled fish anywhere.
Not everything is expensive. It's definitely good to budget and learn to cook for yourself, often in small places, but there are plenty of cheap ways/plays to eat.
There's actually quite a bit of English, but learning Kanji (at least the meanings) like you said is REALLY helpful.
Books like Remembering the Kanji will help you get a head start on learning just the meanings, even before you get into learning any of the readings.
Also, @animeage - don't worry too much about the western foods. Try as many Japanese foods as you can =]