[@Xeronoia] Actually, most honorifics [i]don't[/i] have an English counterpart. The common honorific "san" is comparable to Mr./Mrs./Miss, but those English counterparts have different connotations. In English, calling somebody "Mr." generally means that you are either strangers or that the person is of a higher status for you. The honorific "san" is just common courtesy in Japan. "Chan" and "kun" have no English counterparts other than giving somebody a nickname. "Sama" is often compared to "Lord," but is more versatile than the English counterpart; it is essentially used any time one would wish to express high levels of respect and does not necessarily imply nobility like the English "Lord/Lady." And finally the senpai-kouhai relationship does not even exist in the west as it does in Japan, so the words are pretty much without equivalents. One could say "upperclassman," but while this word describes the physical relationship, it implies none of the social connotations that come with the word "senpai." 

So, since this takes place in Japan and the underlying culture implied by honorifics should presumably be present, my vote is for generally using them. Though, the Westerners in the school who have just learned the language may want to omit honorifics, or even use them incorrectly... but that's just a suggestion.