No not a weird place to me. Actually when you think about it Japan has some advantages for beginning the series there. The country is small and contained so the scale is manageable, while there are many factions/clans they all have basicly the same culture and tech so thats a plus to.
There is alot of talk about STW2 being the next in the series... I hope not. It would be too small after the epic games they have given us. Perhaps if they included China as well.... What I really want to see is a more modern game, WWI perhaps or the American Civil War. Another interesting idea would be a full blown game based on the Mayans, Inca and Aztecs.