First we need to define the term RPG. An RPG is a game where the effectiveness, primarily with regards to combat but sometimes also with regards to other in-game actions, of the playable characters is determined by stats that are
visible, more or less transparent and
manipulable by the player. The manipulation of these stats should be a rather important part of gameplay. Note that changing equipment that would change the effective stats of your characters would count as manipulating your stats as well.
Now that that is taken care of you can classify RPGs based on how the battles work.
RPGs that put a big focus on direct control of you characters, where timing of blocking, dodging and attacking is important for the players success are
action RPGs. Examples include Demon's Souls and Kingdom Hearts.
RPGs where you control a large number of characters, where positioning of your characters in relation to each other, the opponent and the surrounding environment is critical for success, are
tactics RPGs. Note that "strategy RPG is a misnomer. There is a
difference, folks. Examples include Final Fantasy Tactics and Valkyria Chronicles
RPGs where you decide what your characters are doing mainly by choosing between different commands on a list, and which are not action RPGs or tactical RPGs (this qualifier is needed or Kingdom Hearts and Final Fantasy Tactics would count as well) are
command RPGs. Examples include mainline Final Fantasy games and Dragon Quest games.
RPGs where you damage enemies by lining up your crosshairs to shoot them are
shooter RPGs. Examples include Borderlands and Final Fantasy VII: Dirge of Cerberus.
Finally, you can classify RPGs based on the country of origin. An RPG made in Japan is a Japanese RPG (JRPG). An RPG made in Korea is a Korean RPG An RPG made in Sweden is a Swedish RPG. And an RPG made in Poland is a Polish RPG. For RPGs not made in Asia, the collective term Western RPG (WRPG) can be used.
Some people want to think that JRPG should be a genre on its own, where even a game made in USA would be "Japanese" if it adopted enough traits considered typical (by them) of Japanese RPGs. But that just sounds stupid to me, and is not how anything which is not an RPG is classified by nationality. A sparkling wine made in Russia is a Russian sparkling wine and not French just because it is similar to Champagne which is made in France. When a Japanese horror movie gets a Hollywood remake, the Hollywood movie is an American horror movie. Not a Japanese horror movie.
There may be some traits that are typical for RPGs made in Japan, but that doesn't mean that an RPG made in Japan which doesn't contain most of them isn't Japanese. Just like a movie made in Hollywood is American, regardless of whether it's heavily influenced by some other country. Attempts to arbitrarily denote some games as JRPGs and some as not, based on certain traits are futile as it's very difficult to find a precise enough definition which doesn't have too many exceptions and which everyone could agree on. Dividing based on country of origin is much easier and leads to far fewer borderline cases.
To summarize: Demon's Souls is a Japanese action RPG. Cthulhu Saves the World is a Western command RPG. dealwithit.gif