Prices more reasonable in July and August? Aside from New Year and Golden Week (late April-early May), airfares to/from Japan in August are as high as they get, as mid-August is when the Japanese get a precious few days off.
Many head to their place of origin in the country, so Tokyo and Osaka may be fairly empty, but the domestic transportation network is overloaded, with many trains running standing room only on weekends in August.
I would expect demand to be somewhat softer at major city hotels in early August, but not enough to warrant large discounts. In my experience, February and November yield the lowest room rates.
Kyoto is a case apart, as most of its visitors are tourists, often trying to catch the extremely pleasant months of April-May and Sept-October.
Don't worry about the language problem. Signs in Tokyo/Osaka/Kyoto are mostly bilingual, and most Japanese in the tourism industry will very politely and patiently attempt to understand your english (nearly all younger Japanese have studied english 5+ years, they just fear speaking it).
As for suggestions, you'll need to be more specific about your budget. Expect at the very least $100 a day for a normal hotel room in Tokyo.