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Hi. We went to Japan at xmas/new years 5 years ago, and loved it so much that we have gone back every year at that time except one (that year we went to Shanghai instead)!
In fact, we'll be there around the same time. We're usually there during the days you'll be there, but this year we're going to Korea/Taiwan first, so we arrive on the third or fourth instead, so we'll miss you!
Going to a shrine to ring a bell is one of the big things to do over new years, however we did that the first year at the Meiji Shrine, and waited in a line for awhile until we gave up! However, the atmosphere at shrines and temples during this period is great, like a fair would be in a western country, with lots of interesting food stalls and stuff.
One of our favourites is the Yasukuni Shrine, details of which you can find on this site. They have a great, festive walk up to the shrine with lots of food stalls, and at the end, you pray, clap your hands and throw some change into the shrine for good luck!
On Jan 1st, shops are generally closed, except around the shrines, so it's a good day to plan on doing that.
On Jan 2nd, shops open again for the new year, and you can do something called "fukubukuro" which are sort of "lucky dip bags" that the department store sells. Basically bags of goods which are sold, with the bag sealed shut, for a certain price, with a guarantee that the goods inside are worth significantly more than the going price.
My favourite fukubukuro are found at Nishi Ginza department store in Ginza (Yurakucho), in the jewellry/Makeup section.
We stay every year at one of the Oakwoods in Roppongi, but that's because we always stay for a week and we now have "our" apartment that they try to keep reserved for us during that period.
With the exception of the Oakwood in Shinjuku, I don't think many of them will rent to you for less than a week, but I'm told the one in Shinjuku is nice.
I've also often looked at the various Hotel Villa Fontaine chain and thought it looked like good accommodation for a reasonable price. There's one of those in Roppongi too. If you want night-life and a touch of western elegance in Tokyo, that's the place to be! But Ginza and Shinjuku and Shibuya are all very nice too.
People will tell you xmas/new years is a bad time to be in Japan because "everything's closed", but they are wrong. You won't notice it much at all, unless you want to go to a great deal of museums.
If you want to get some more information on Christmas and New Years in Japan, have a listen to the podcasts on Japanesepod101.com website.
Most of all, have a great time, it's really a fantastic, festive time of year there.
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