The Junkyardblog has an excellent link to an economist piece on the reawakening of Japan as a military power and its relationship with China. I think it is worthwhile looking back in history a bit to see why this relationship is what it is.
There is an argument that says that the 1894/5 Sino-Japanese war led to Japan's involvement in the second world war. The theory works like this: the "Triple Intervention" by France, Germany and Russia humiliated Japan and made Japan far more belligerant than it might otherwise have become this then led to the Russo-Japanese war ten years later and to the subsequent fanatical nationalism in Japan that led to Japan's further attempts at military conquest. Certainly the 1895 war was the first time that Japan soundly beat the country which had culturally dominated Eastern Asia for more than a millenium. The island of Formosa (Taiwan) was one of the spoils of that war which Japan held onto until 1945. Indeed what with Dutch colonization, Japanese colonization and the like Taiwan has spent a very little time actually ruled by a mainland Chinese regime.
When you look further back in history and Chinese(Mongol) invasions prompted the original "kamikaze" - the wind that did to the Chinese fleets roughly what happened to the Spanish Armada 300 years later. Further back still and China exported writing, buddhism and many other concepts to Japan. On the other hand imports from Japan to China were approximately zero. The difference in reaction to the European (and Amercian) colonizers between Japan and China (and Korea) is educational. Japan was shocked out of its isolation and set out groups to learn what the West had to offer. It then adopted what seemed to be best practise. China did its best to ignore the West and tried to throw them out - it failed miserably in much the same way that India had done half a century earlier. Korea tried to remain untouched and, since there was not much interest in Korea it was left in that state as a semi-vassal of the Chinese.
In 1894/5 all that changed. Japan comprehensively warned the world that it had learned how to fight a modern war and did so. For the next 50 years Korea was a Japanese posession and China was dependant on foriegn aid to defend itself (at which it mostly failed). The Japanese lost to the Soviets in Mongolia in the 1930s (it was their bad luck to encounter a general called Zhukov who understood mechanized warfare like few others - only Rommel and perhaps Patton could have been his equal), and they ground to a halt in Burma, but they didn't lose until the Americans got involved. After the second world war the Japanese managed to do economically what they had failed to do militarily and dominated East Asia in precisely the way that China had done for all the previous millenium or more.
This is the background to the continuous rumblings between the North Capital (Beijing) and the East Capital (Tokyo) over the last few decades. To China with its millennia of dominance it is inconceivable that a neighbouring power should stand up to it. To Japan the last hundred years have been a revelation about how it can survive on its own. You could think of it as the way a domineering mother perceives her independant minded teenager and vice versa.
But I suspect that in order to understand how the future looks it may help to think of hackneyed thrillers and children's adventure stories. Japan from 1895 to 1945 was a criminal, stealing, threatening and generally causing havoc, but having been caught by the cops in 1945 it did its time and resolved to turn over a new leaf. Meanwhile the other people in the neighbourhood have been squabbling and scrapping and they keep on telling the reformed criminal that he was a bad boy and needs to apologise again. Thus far the reformed criminal has kept the peace despite the provocations but as time goes on he begins to see that one former victim in particular seems to be behaving in the same way that he used to before he reformed. This new bully is not just threatening others, he is also supporting weaker troublemakers as well. In the story the reformed criminal eventually decides that he should teach this new bully the error of his ways and stands up against him on behalf of some of the victims. This is of course a shock to the new bully who had assumed that the former criminal would remain cowed by his past. Whether this plot will play itself out the same way in geopolitics is to be seen.
I don't know what will happen in East Asia in the next fifty years but I am sure that China bears most of the blame for the present state of affairs. Not only is it pursuing a dangerous game of threats against Taiwan it is also deliberately supporting North Korea and that clearly emboldens the North Koreans. I believe one can blame the N Korean regime for convincing Japan's public and government that the time for pacifism is over. If China regrets that Japan is gradually rejected pacifist neutrality then it has only its own policy of supporting N Korea to blame and its own policy of threats to Taiwan for making the Taiwanese eager to make their former imperial overlord an ally.