Four Days Later...
After the opening cutscene, you can look around Ryo's room to get used to the controls. Looking on the desk and in the drawers will get you a few items for your inventory - none of them are essential, but the tapes might help you pass the time later in the game.
Once you're done, head into the hall to get a cutscene with Ine-san - she'll ask that you're doing okay, and will give you the first of your daily ¥500 allowance, before telling you that Fuku-san wants to speak with you in the dojo.
If you go into the kitchen, you'll get a short flashback of your father when you look at the carrots on the table. It's worth looking around the Hazuki house for a while; there are plenty of items to examine, and there's two move scrolls - Twin Blades behind the altar room and Shadow Reaper in Fuku-san's room.
When you leave the house, you'll find yourself in the courtyard. Head left, around the side of the house (not through the main gate), to get to the dojo. You can walk up to the tree outside the dojo for another flashback, or just head straight in to talk to Fuku-san about what happened between Lan Di and your father. Once that's done, you'll be back in the courtyard. Head back to the front of the house, and go out through the gate.
There's only really one way to walk through Ryo's home village, so follow the road down the hill. When you're passing the shrine, Ryo will hear a cat meow and go in. He'll spend a few minutes talking to Megumi, a little girl who's adopted an orphaned kitten. The cat's mother was killed by a black car, similar to Lan Di's, and the car almost hit Yamagishi-san, an elderly man in Sakuragaoka.
Once you're done, continue down the hill to...
Take the first right, past the phone booth - the only other path is a dead end. You'll come to a T-junction, where an old woman will ask you to help her find the Yamamoto's house. If you want to help her, it's on the left from the T-junction, more or less opposite the road to Dobuita. She's waiting for you in the park. If you're not feeling helpful, you're just looking for Yamagishi-san's house, which is the last house when you turn right at the T-junction. He'll tell you that the car was racing towards the shopping area in Dobuita, and that people there might have more information.
You can ask a lot of different people about the car, but they'll eventually point you to a girl who got splashed with mud by the car - your classmate Nozomi, who's standing outside her grandmother's flower shop opposite the fruit and vegetable seller. Talk to her for a bit, and she'll tell you that your friend Tom had an argument with people in a black car. Go along the main street past the Tomato convenience store and you'll find Tom dancing at his hot dog truck. Speak to him and he'll tell you to ask Chinese people about other Chinese, as well as offering to ask around on your behalf. Go back towards the Tomato store, and you'll encounter the first QTE of the game with 2 local thugs.
You can ask several different people about local Chinese, but they'll generally just point you to Tao-san at the Ajiichi Chinese Restaurant. Talk to Tao-san, and eventually tell you about the "Three Blades": the Barber, the Tailor and the Cook, a set of ancient professions that most Chinese immigrants in the area are involved in. He'll mention three people to speak to - Itoi-san at the Mary's Patch shop, Maeda-san the barber and Yamamoto-san at Manpukuken Ramen - as well as Liu-san, a barber whose father has been ill lately.
Before you speak to any of them, you should go to Suzume Park beside the Arcade - Yamagishi-san will teach you the Double Blow move. If you don't get it now, you won't be able to pick up the move later.
Speak with Yamamoto-san (at Manpukuken Ramen) and she will tell you about 2 former Three Blades Members (Yong San and Wu San) that hang out in the bars after work drinking. Head to Bar Yokosuka (straight out of the door of Manpukuken Ramen on the left hand side) and speak to the bar tender. The 2 former Three Blades Members are sat at a nearby table and will overhear your conversation, approach them to talk to them. Keep talking to them until your diary has been updated, they will point you to Liu-san Barber, although his shop's been closed until now. It'll be open once you've spoken to any of the Three Blades, so you can now go in and speak to Liu-san. If you do this in a timely manner you will have time to visit his shop before he closes at 7pm.