One of the DPJ's most powerful figures, Ozawa has been credited by many to be the mastermind behind the party's dramatic rise to power last year. Many think his expertise is vital to winning this year's upper house poll, too. The DPJ would suffer a blow and lose the capacity to set policy direction if Ozawa were sidelined before the poll for the upper house.

But some analysts say the DPJ may be better off without Ozawa. Even some DPJ leaders wonder whether Ozawa's pugnacious approach to politics could prove as much a bane as a boon for the party.

Ozawa has presented the DPJ with a dilemma ever since his small Liberal Party merged with it in 2003, especially because the present ruling party relies on his skills, even though his image as an old-style political fixer is denting the popularity of the party. A protg of former LDP kingpin Kakuei Tanaka, considered by many to be the father of Japan's modern pork-barrel politics, Ozawa left the party in 1993. He was perhaps the most effective figure seeking to end LDP's long grip on national power. He took over as DPJ leader in 2006 but stepped down last May after a former aide was charged with accepting illegal corporate donations.

Analysts believe Ozawa's public defiance and criticism of the prosecutors' investigation into his funding may have prompted the wider probe. The scheduled start of the ordinary Diet session on Jan 18 was one factor behind the prosecutors' decision to take to a hard-line strategy, making the DPJ heavyweight's position perilous.

But Ozawa's woes have a potential silver lining for Hatoyama's stumbling government. With the DPJ's "shadow shogun" preoccupied, the Hatoyama government may find it easier to dispel the notion that it is under his thumb. If Ozawa steps down it could give the DPJ an opportunity to become a more sustainable political force in the long run.

The DPJ and its allies could ignore any opposition boycott, too, but that could further erode their support among voters.

The DPJ swept to power in the August election that ended more than half a century of nearly unbroken LDP rule by pledging to reduce bureaucratic grip on policy, cut waste and boost consumer spending to help rein in the country's ballooning public debt.

But the investigation against Ozawa has become a public relations disaster for the DPJ and is fuelling doubts about its ability to deliver on the promises of change. If things are left as they are, it could disappoint the public further, forcing it conclude that nothing has changed except the change of government, and politics remains as corrupt as ever.

The LDP's ability to take the offensive during the Diet session, however, is in doubt after it failed to do so in the extraordinary session last year. Recent reports show that while Hatoyama's Cabinet has been losing public support, the LDP, periodically racked by scandals during lengthy rule, hasn't seen its popularity rise, either.

The LDP needs a reality check if it thinks that just focusing on the DPJ funds scandal will help it return to power. Instead of taking the easy path by exploiting the DPJ's woes, the LDP should reflect seriously on its past policies and spell out to voters how it would run the country if given the chance again.