Japan has a lot of potential, but it would require some skill to pull off. You're looking at a Japan that never went through the post-WW2 Americanization. The only force acting against Japanese tradition would be the communism of China, but Japan is also playing the part of the Disgraced Empire, and because of this nationalism and revaunchism would take hold. Their relationship with China would be a teeth-grinding grin and bear it, and the youth would grow up in a depressed society with a tendency toward angry conservatism.

So really, more than anywhere else in the Precipice world, Japan is the one place that would most likely become a Fascist state. Not using the term Fascist of course, since that term was specifically invented during the rise of Mussolini which did not happen here. 

You'd probably be seeing signs of eternal struggle. Communists and socialists being harassed, or even murdered. Paramilitary organizations forming around traditional Japanese concepts of honor. Fanatics wanting to fight an unrealistic war against China while the less fanatical look at the Pacific as their own playground. 

This can all be done, and you can toss caution to the wind in this unique instance so long as you realize a few things. One, Japan cannot defeat China. It would be youthful overconfidence, or a belief that honorable defeat is better than peaceful skulking, that would ultimately drive them against China. China's industrial and military abilities could bring Japan down though. No question about that. The other thing is that, even if nationalism draws them into Pacific Imperium, there isn't much to be gained there. A Pacific Empire might fulfill certain emotional wants, and it might get them some minor economic boons, but it will not make them a major power.

So that is kind of what Japan could be. Exploring the creation of a Fascist state while always living in the shadow of your neighbors.