Joey,
If you stay so long definitely buy the real phone because eventually it will be much cheaper. When you start studies in Japan by the time you will get more and more friends and you will call more and more, so better forget about prepaid.
Just first check about the contract period to be 6 months, otherwise if it is 1 year or more you will leave Japan earlier and have to pay some difference if break the contract. Usually cheaper devices have shorter contract so don't take any "space" model even you see price is very low, it means you will pay it through 24 installments and in fact will cost a lot.
Many people are using Softbank because it is the cheapest but me and some friends are really unsatisfied with their service (a few times shop staff were not so kind and pretty useless, and network coverage is not the best), but with "White plan" I can call any Softbank phone for free all the day except late evening so that keeps my bill really small.