Ho boy this debate again. Then again, I'm not sure I've ever clearly stated my position on this. I have worked on projects where I've translated it both ways - leaving honorifics and a smattering of Japanese terms, and the alternative without leaving a single Japanese'ism in the translation. In my opinion, I think the ideal translation would never have any Japanese terms, except for things like food names and so on as that's how they'd be referred to in the west anyway. HOWEVER, it is extremely hard to do this and capture the nuance and please everyone at the same time (some would say impossible.) What people miss, though, is that if this is done seamlessly, the reader is completely unaware of the use of these terms in Japanese unless they're weaboos (note I consider myself somewhat of a weaboo so I don't mean this only in the derogatory way.) Weaboos are actively LOOKING for Japanese terms in the audio, or have a vague idea of what was in the original script and generally know some Japanese, but are usually not fluent in Japanese themselves. The more Japanese you know, the more forgiving you become of liberal translations since you have a better understanding that nuance is far more important than accuracy (they're subtly different things.) On the flip side, however, the target audience for these translations ARE weaboos, so the reality is they don't actually WANT a good translation, they want their little understanding of Japanese to make them think they understand it better if they're left in. Knowing your target audience is an important thing. Who are you translating it for? If you do an excellent liberal translation dropping honorifics and Japanese terms, you will get a fixed percentage of people that will be annoyed, irrespective of how good the translation is, and if you do a bad one, you'll get a large percentage of people that are annoyed. If you do a translation where you leave the honorifics and Japanese terms in place - provided you don't start making it clunky and literal, you'll actually get very few complaints at all. So in that regard, who are you translating it for if you're killing yourself to make it as liberal as possible? Fan translations are entitled to do whatever the hell they want. Official releases are a different matter... So anyway, if it's a trillion times easier to leave them in, and you end up pleasing more of the audience, why the fuck go about it the hard way? Put a handy translation notes card in with the game release explaining the few terms used for the few newcomers to the art form.
This might seem contradictory given I'm currently working on haruuru and we're not using any Japanese terms, but then ours is a fan translation, and some of us really wanted to try to do it without (me included). I think we've done a very good job on this (no dudes here.) Note also we played the game through before beginning the translation too. My translation commitment on that project is also almost complete. However, for games set in Japan, I think from now on if I were to choose, I'd just leave them in.