I believe it was Pete Davison (formerly of USGamer) who said that the big difference between American and Japanese game music is that American game music tends to be inspired primarily by the soundracks of American movies while Japanese game music tends to be inspired by J-POP, or something like that.
I also personally think that part of the difference is that the Japanese industry has its roots in the games of the 80s and early 90s, where it was impossible to replicate the music created by real instruments so you had to figure out what music worked best for video games and video game hardware, whereas the western game industry didn't really come into its own until the 00s, when hardware was at the point where you could slap in whatever mp3 you wanted for your music, so the inspirations came more from contemporary non-game music and cinema soundtracks.
Hell, in general I think a large part of the difference between Japanese and western video games probably comes from the fact that most Japanese developers have their roots in the games of the 80s and 90s while most western developers played a shitload of the games in that era but didn't start making games themselves until the late 90s/early 00s.
EDIT: And I don't think it's a crazy coincidence that most of the good western tracks people are linking are either from pre-2000 games or from composers who have been doing video game music since pre-2000.
I think it's more the "wanna-be like Hollywood, cuz movies are more respectable than the luditic game industry so the money men will sign off on our game if it's got a non-scary, submissive filmic wanna-be Zimmer OST" deal.
And yes, while the Japanese industry got its musical value system came from a pop band*, alot of J-composers had training in
jazz, classical, metal, or
prog. as well. The below addendum will illuminate just why this gigantic lead jumped open during gens 3-6 reguarding OSTs on a country-to-country basis like this.
*which in turn, allowed the bar to be raised on OST quality by the sale of game soundtracks, with the feedback bouncing back and forth bringing in more money for publishers. Some of those tracks above sold tapes/CDs. That's a powerful incentive to let them work their magic!
Ya, Last Ninja 2 has a pretty awesome soundtrack. All of them do, but there is one track in Last Ninja 2 that I particularly like:
https://www.youtube.com/watch?v=hraWQcNbYn8&index=13&list=PL5E751B086CB2C4C5
Those european systems were home to lots of really awesome Synth music that I'd argue many in this topic are saying Western music didn't cover. Ocean's C64 loaders in particular had some awesome tunes:
https://www.youtube.com/watch?v=WyAd1qKIiXU
The load times may have sucked, but man it gave you a pretty cool show while it loaded..
More euro synth goodness:
Zool 2 - Tootin Common:
https://www.youtube.com/watch?v=EJB8lR_MFbA
Lotus Turbo Challenge 2:
https://www.youtube.com/watch?v=LQSsq7HCNHw
This is the other facet.
The Euro PC/Console hybrid scene was a bloodbath of musical competition. When you have the likes of Gonzalez,
Iveson, Hülsbeck,
and the Follins filling ears with magical goodness, dogshit jank is not going to fly with the game-buying public as this elevated level of compositionial quality is a criteria for game purchases, just like it was in Japan.
A significant part of the supposed memorability we have from classic Japanese 8- and 16-bit games simply comes down to sheer repetition. But that kind of simple looped structure just doesn't lend itself that well to how many games work today which expect you to play in much longer sessions. So we have dynamic systems in place working behind the scenes, often mixing between different layers and stems. It's a great way to take better advantage of the interactive nature of games and avoid making the player feel fatigued by the music, but doesn't really lend itself as well to being listened on its own terms, while much older games mostly abided by the pop song structure. All of this applies to old western games as well of course, but given the console-centric demographic of NeoGAF you'll naturally see a lot of folks being hopelessly dismissive over this.
I think a good example of a modern game that tries to implement music in a traditional way but suffers from this is Elder Scrolls Online. It has as big a soundtrack as you'd expect from a big game like that, and the music in itself is really pretty good, but due to the way it's distributed and just plays the track on repeat all the time just makes you get tired of it rather quickly when you play for as long as you often do in MMOs and spending time in one area with a certain set of tracks.
It's funny you when you say MMOs; it's the one genre I turn the music off first thing so the conversation with other players becomes the musical accompaniment.