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Capcom was taking a risk localizing the original game and wrote it off as a one-and-done situation, but the game overwhelmingly exceeded their expectations that they needed to reprint the original game like 3 or 4 times to meet demand.
But due to wanting to give it the best possible chance and not thinking ahead to future games, they localized the game with the idea of it being set in Los Angeles, California.
I don't mind about the Japanifornia setting.
Capcom likely isnt going to change this unless an overwhelming backlash happened.
That said, this is the PC. Mods happen.
And these changes arent drastic enough to the extent of something like Power Rangers, where both versions are capable of coexisting in the same market.