Is it true that you can sign up for a Japanese playstation network account and download Jap only demos and games? has anyone tried this?

yes you can but you will need to make a new user on your ps3 for this to work. you will also need a seprate PSN id for the new account an make sure you input a valid japan address.

same thing if you want USA psn games demos etc...

its well documented and you will find many youtube videos on this.

hope that helps

I finally got around to doing this.... I can't make heads or tails of the Japanese store, the categories are different and I can't read Japanese. Guess I'm probably not missing much.

I do this as well. But I understand because it is the language of Japan.