I really think the food examples are bad ones, because it's something that can easily be explained as a simple word you don't know. There's a lot of American food that I've never even heard of, despite having spent the majority of my life in the states! Those are just word replacements -- and Japanese food DOES exist in the West -- so I think it's not really an accurate representation of the benefits of localizing.
More to the point would be something that requires a cultural understanding to get. Idioms are a prime source of this (the popular Japanese idiom meaning "I'm really busy" translates literally to "I'd love to borrow a cat's paw" [猫の手も借りたい]), but monster names and items in RPGs generally have a strong connection with either cultural norms or Japanese wordplays and puns. In that case, by not translating the name, the English-speaking user (often unaware that there's a reference at all) is getting an inferior experience to the Japanese player. For example, I just researched the roots and history behind all of the monsters-of-the-day used in the first series of the Sailor Moon anime for my blog. You could argue either way, but if you don't localize at least some of the names, the Western audience is getting less out of it than the Japanese audience did.
A famous example of this is the Octopus statue in Mother 2 which was replaced with a giant pencil. This was to keep a similar wordplay gag while at the same time making it something the western audience could more easily understand.
The reverse is also true in the old Commodore/NES game "Maniac Mansion." In the very beginning of the game, you need to get into the mansion by finding a key to unlock the front door. Where's the key? Under the doormat, of course! Many Japanese gamers -- where there isn't a running gag on TV or social norm of putting keys under your doormat -- weren't able to get past this screen because the had zero reason to check under the doormat when looking for a key.
So anyway, just figured it worth mentioning that there are more things that need to be considered than just simple word replacements. Cultural norms you grew up with also have a huge impact on your thinking of cause and effect and can greatly color the experience of the player. Just some food for thought!