What is the best way to organize a bilingual website for major search engines?

[Joe T]

After completing this nightmare of a website for my client this week, on an awful content management system, after his refusal of using MY content management system and refusing to split his BILINGUAL website up into subdomains or subfolders, he has decided that maybe NOW we should split his website up. Just awesome. Here is the current website: http://www.martyregan.com/

Because we didn't use subdomains or subfolders, I wrote tons of scripts to swap the English containers of content for the Japanese containers of content throughout majority of the site. What a nightmare and what a tedious and bad idea this was. Now realizing that we should have split the website up, we plan on making this change over the next week or so.

Now it's not going to be much more work splitting up the already written content onto two different sites, but I'm not really sure what the best route to go about splitting them up is, especially which would be better for the search engines and how the site(s) index.

Should I be splitting them up into two different subdomains, like this?
en.martyregan.com and jp.martyregan.com

Or as subfolders, like this?
http://www.martyregan.com/jp/

I'm not really sure if there's much of a difference or which would be more beneficial, but his goal is reach both English and Japanese viewers based on search results, of course.

Thanks ahead of time for ANY help that can be provided!
I used Concrete5. What an awful CMS. There is no use for a translator, the client knows Japanese and already inputted all of the Japanese content onto the website. We are trying to figure out the best way to split the site up.

A secondary domain sounds like a nice idea, but it's still hilarious how my client is paying THREE dollar/month hosting and nothing for the current domain and wants to know if a second domain is necessary.

So it comes down to either:

en.martyregan.com and jp.martyregan.com

or

http://www.martyregan.jp/

Which will he benefit from more when it comes to indexing both of his content into the search engines?