The myth is that the cost of living in Japan is ridiculously high and that apples cost the equivalent of 50 USD each. If you did fancy buying a 50 USD apple then there are places which do indeed sell em at that price. But the fact is that most media are not going to cover stories of apples that are reasonably priced.
If however you are hearing from a friend that their trip to Japan cost a bomb then its probably because they were spending time in a hotel and eating at out all the time at touristy places.
Been living in Japan for 12 years now and after visiting Europe and the US a few times in between, I feel that its much cheaper to live in Japan. This depends on *how* you spend yer hard earned dosh and *where* you spend it.
A few things to keep the cost of living low - shopping wisely at the 100 Yen Shop, Ikea, Kakaku.com for electronics and setting up a Sole Proprietorship (I need to update that post a wee bit) will save you a load of cash. Another thing to help keep costs low is to shop at Costco - a supermarket that sells groceries, apparel and electronics at wholesale prices.