Japanese engines are no different than any other engine, they can and do fail. Very rarely does an engine fail in a car in Japan as their laws are designed in such a way that keeping a car past four years of age will incur a significant penalty so most often the car is scrapped or parted out and sold.
In the US there are no such constraints, a person is free to drive a car for as many years as he or she wishes; there are very few constraints other than emission control issues. Because the car in the US can be driven for many years, there is significant potential for engine or transmission failure. Of course, if the problem is minor it is simply repaired or a component may have to be replaced, however, if the engine problem is serious and the engine completely fails, it either must be replaced or the car and engine head for the scrap yard.
When Japanese engines fail there are three ways to affect a replacement; one is to buy a used engine complete, one is to buy a short block and the other is to buy a long block. Obviously a complete engine is just that, an engine with all the external devices such as the water pump, fuel injection system, etc. A short block and a long block are both sub assemblies. The short block typically is no more than the engine block and the main rotating assembly, notably the crankshaft, pistons, piston rods and piston rings. If the engine does not have an overhead cam, then the camshaft will be included as well.
A long block on the other hand includes everything that makes up a short block, plus the heads, overhead cam and valve train. About the only thing that is missing is the water pump, manifolds and fuel injection system which are usually re-usable when the engine is rebuilt.
Although a short block costs less there are considerations that the customer should make before he chooses between the two. In many cases there is considerable machining to be done on the heads before they are useable; often the cost of machining is offset by the rather small difference in price. If the heads, cam and valve train are fine, then of course a short block is a good buy, but often this is not the case and a long block is the better buy.