I'll weigh in on this one.

Japanese in an English language 'fic?  I avoid it.  I want my fiction 
to be enjoyed by the largest possible number of readers, including 
those who are not "fanfic otaku".  I want to avoid anything that will 
alienate readers.

Honorifics?  They're harmless, since the full name is still there, 
and because mainstream English translations are using them.  Viz has 
used "P-Chan", "Ran-chan", "Lum-chan", and "Ten-chan".  Hell, even 
the new EL-HAZARD TV dub uses "Makoto-chan".  (My jaw nearly fell off 
when I heard it.)  "-chan" is now almost as widely recognized as 
"-san".  Perhaps "-sama" and "-dono" won't be far behind.  :-)

But full Japanese phrases?  I can't see the point, unless you don't 
mind that you're narrowing your audience to only the hard-core 
nippophile fanfic otaku.  As others have pointed out, these phrases 
gain you nothing that the English translation can't give you, except 
in the cases of obscure Japanese phrases and puns.  And the latter 
will appeal only to a small minority and alienate everyone else.

Only once have I used a full Japanese phrase, and then not trivially. 
At the pivotal moment of "The Green-Eyed Monster", I had Belldandy 
shout "Keiichi-san no baka!!" and run away in tears.  I anguished 
over that for a long time.  I didn't want to use the Japanese, but I 
didn't like the common (if inaccurate) translation "Keiichi, I hate 
you!"  That statement didn't convey the feeling I wanted.  I wanted 
Belldandy to say something you'd never expect her to say, but 
something we've often heard other anime girls say.  So I decided to 
take the chance that "no baka" was common enough that most readers 
would know what she'd said.  I think it worked.

------RM