Yes, you generally need to use UTF-8, or at least a Japanese encoding. But if you require any kind of international language support, then unicode is the way to go, because it can handle all characters. It's the wave of the future. I started on Linux before unicode support was complete, and Japanese support was a b***, let me tell you.
But let me also advise you from personal experience that it's easier if you just use alphanumeric characters in filenames. Things like file globbing and sorting are much more complicated with Japanese, and I still haven't figured out how to do Japanese input on a non-gui terminal yet. I always simply romanize my Japanese filenames now.
This is the best page I've found concerning international text support. It's debian-focused, but most of the info is distro-agnostic.
Web page displays depend only on the browser's rendering engine and font availability. They have nothing to do with the system encoding.