Neither English nor Japanese are my native language but it didn't prevent me from enjoying video games. If you had existed in the early days of the video game industry then you would have played Japanese games way more than English games you could find around. This kinda made Japanese my 2nd native language in a way I could read Japanese way better than I was able to read my own native language, and then I learned English just to play games lol. Do you know how hard it was to find Japanese and English dictionary and do you know the pain of trying to find the words while playing games? No internet back then, you only have a public library and its not so friendly librarian cursing at you for ruining her lone serenity lol. Perhaps there are more English speakers but the thing is there are way more Japanese speakers who actually play video games than there are English speaker gamers. Currently video game industry is tied to people playing games in non-English language by official or fan translations so they ignore official English translations because most people wanna experience whatever they want in their own native languages. Do you think English language in video game really that matters? If it was they would just translate to English and call it a day, and then they would lose huge sales in most of the world lol. As a gamer not knowing Japanese is a hindrance for your enjoyment especially because official translations have the worst quality lol. But I agree that a person shouldn't have to care learning new languages and companies shouldn't be lazy to at least translate games to English to make a profit without leaving the games stuck in Japanese. Square at the time perhaps didn't think street racing wasn't exclusive to Japan's culture but they were probably too lazy to translate the game as much as many companies back then like CAPCOM and Namco that often cut contents just to translate their games less sometimes lol.
For example Ace Combat 3 is peak in military air plane fighting game that has an official English translation but actually the English version is merely a shadow of the original Japanese self so it actually make the Japanese version the peak one while comparing officially translated to English military air plane fighting games Air Force Delta becomes the peak one lol.
Long story short, how great a game is doesn't depend on whether you can understand it or not. So many kids still enjoys video games they cannot even understand because not everyone knows English. You may cannot understand Racing Lagoon but at least you gotta understand how well developed the game is while Need for Speed Underground and related street racing games like Midnight Club series are just 1% of the shell of Racing Lagoon lol.
Then it make me think why OP think the way they think to write the message. All I see is the expression of they didn't live in the era so they have no idea how these games are important for the history of video gaming. Such people who never existed in the era cannot get how even Test Drive series was a big deal and how Need for Speed series felt flat compared to Test Drive series and Racing Lagoon but they were okay games with better graphics. The thing is better graphics cannot make a game "good" per se but this is the way video game industry is so empty anymore. Realistic graphics but merely a game — nonsense. Games keep being less of a game every year. People who love Netflix buys AAA games for FFF quality and instead of touching grass they enjoy dull realistic graphics of today's games. As a result people like OP says "ugh I think pre-PS2 era had no decent racing game" and I know they mean "no decent game with decent graphics" because clearly they were born in PS2 era or post-PS2 era. I'm fan of PS2 myself and I will always say around that how great PS2's library is but if you had compare video games between platforms PS2 never experienced peak in racing genre at all. For example in terms of visual car modification NFS Carbon was peak, no denying that but still it's an empty racing game as much as Midnight Club 3 for not having actual taste of street racing. Perhaps in PS2 only real deal racing game was Test Drive Unlimited series and Test Drive Eve of Destruction. I would also add Burnout series but they were "meh" fun games that after 2 minutes of crashing cars you just get bored lol. Flatout series tried something new and it only has a different arcade fun, never took the game seriously as a racing game. So after experiencing Racing Lagoon for years excuse me the racing games after it cannot interest me at all because it feels like getting used to driving Ferrari and then they sell a temporary license to rent a horse cart just for $80 lol. In new generation kid context imagine you get used to play GTA 5 but then rest of similar genre games stops being open world or even able to kill anyone you want. This is what racing genre feels since Racing Lagoon lol. Of course there were "close" games since Racing Lagoon like Street Legal Racing and Tokyo Xtreme Racer series but they were not that great.
I'm not sorry for my English. No animals were hurt writing this message and no word ruined the ozone layer. Carry on lol.