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Belton wrote:strange. (and possibly illegal by being discriminatory, but good luck to anyone fighting it)
look elsewhere.
Doesn't seem to be a problem in traditional tatami rooms, where I've seen occupancy up to 6 and I think even 20jyo rooms for more than 7. And they're more interesting places to stay than a business style hotel.
Try
http://www.itcj.jp/index.html
or Rakuten
http://travel.rakuten.co.jp/en/
for an assortment of hotels and ryokan in the same sort of price range as Toyoko Inn I think, maybe cheaper.
Of the business hotels I've stayed in I liked APA. small rooms but quite good.
Usually I see charges as per person rather than per room. Worked well for me as I travelled alone (no single surcharges), not sure what it means for people travelling together.