Since about 1995, I have been writing on the WWW about manga and anime, using my understanding of both Japanese and American culture to help analyze manga and anime for a Western audience. Lately I find myself working to correct severe misunderstandings and stereotypes of manga and anime.
I was invited to present a paper at the 1997 Conference on Japanese Popular Culture at the University of Victoria. The paper I presented was on Romanticism in manga and anime, which was later published.
I also attended the 2001 Schoolgirls & Mobilesuits Workshop at the Minneapolis College of Art and Design. Given 9/11 as an impetus, I spoke on the topic of emotional depth in anime and the social responsibility of being an artist who works on anime/manga.
I still have to admit my Japanese isn't perfect, and I do make some translation errors.
Similarly, I consider manga to be Japanese comics, though it technically refers to comics in general.
First, art style. Japanese animation has a distinct art style, and uses sophisticated camera movement and effects, for example. Many people know the "big hair, big eyes" stereotype. Lately there is also the (misguided) stereotype of "lots of mecha/robots and violence and sex." And of course anime is made to look visually stunning.
Second, story content and style. Japanese animation is generally more philosophical and character-oriented. Even in humorous Japanese animation films, the character's struggles and lessons learned often form the core of the story. Also, characters in Japanese animation are generally more realistic, more interesting, and more three dimensional.
The Japanese are generally a romantic, sentimental people (in a very private way); they also have a strong (again private) sense of idealism. These tendencies come out in the stories. Japanese stories very often stress things that many American stories forget, such as self-sacrifice, the search for meaning, the power of helping others, and the idea of redemption for the fallen.
And many anime and manga contain complex moral/ethical messages and profound observations about society, without the Pollyanna-ish, simplistic naivete of so many American stories.
As for big eyes, etc.: Not all anime characters have huge eyes (though they do tend to be larger than normal). I think part of it is cultural, and part biological. Human beings naturally prefer a larger eye-to-face ratio, for example. However, other things, such as being clean-shaven vs. having a beard, are societal preferences. Finally, larger eyes may allow the audience to see expressions more clearly, as one's eyes tend to convey subtle expression; and the eyes also serve as artistic symbols of innocence or intent (bigger eyes often imply innocence or sincerity). I think these things explain much about anime.
(On another note, I have recently heard again that Western comics' large eyes (e.g., Mickey Mouse) influenced the large eyes of modern Japanese manga.)
Re: Caucasian: See above about the biological preferences for big, round eyes. Hair color, though, I think is partly aesthetic, partly historic/cultural. Variation in hair color is visually more interesting than just having black hair -- and notice how some characters have impossible hair colors like green, blue, or purple. As for other distinctly Caucasian features, this may stem in large part from Japan's historic love/hate, envy/friendship relationship with the West. If you look into research on Japanese history, over the centuries you can see interesting changes in their self-perception compared to their perception of Westerners. Also, current world-wide media standards for beauty are largely saturated with Caucasian features.
There is another major theme in manga/anime, especially in those that that don't have battles or violence or sex: self-discovery and personal growth. With so many manga/anime directed at young adults, it's not surprising that they often contain the theme of finding a role for oneself ... of overcoming misconceptions, and of rising above pettiness and selfishness.
Granted, there are many anime and manga that have no purpose other than to gratify sensual desires. I don't dispute that they exist. But to lump all manga and anime into that category is a great mistake. There is much that we in the West could learn from manga and anime.
1. Flashy effects and beautiful artwork. This includes the stereotypical violence and nudity of many science-fiction animations, but more importantly also includes the general aesthetics of Japanese animation too: Vibrant, complex landscapes, distinctive characters, sophisticated cinematography effects, camera work, etc..
2. The fact that Japanese animation tends to stimulate both thought and emotion. Japanese animation stories traditionally contain philosophical and spiritual elements, ranging from in-depth character growth, to philosophical arguments between heroes and villains. These stories are also not afraid to put the characters in moral quandaries, or to subject them to heart-wrenching loss. To follow the stories, one typically (though not always) needs to engage both brain and "heart."
As a note, one person who wrote me suggested it is in part due to the large number of Hong Kong immigrants in Canada; since manga is apparently quite popular within the Hong Kong community, the demand would correspondingly become higher for anime as well.
If you mean the generals of when an animation is made, I have some sketchy knowledge. Generally, animation starts off as a comic series that is published periodically in a magazine. If the comic series becomes sufficiently popular, it is turned into animation. Whether the animation becomes broadcast on TV, or is merely churned out in video form, is a process that I don't know much about.
However, many things remain strongly Japanese. If you listen to the original Japanese, you will probably notice differences in how characters address each other, based on social rank and gender and societal role. If you pay attention to the philosophy and spirituality, as well as the supposed "world background" of the story, you will notice that much of it is based on Japanese beliefs, hopes, and fears (though a lot is also based on the author's personal viewpoints). The characters, the world, the actions, the heroes' roles, the villains' roles, the dialogue, the voice acting, the music, the moral of the story, the jokes --- all these are touched by Japanese culture.
I think the US needs to first get its priorities straight about TV. Does the US want to churn out mindlessly violent or silly TV shows? Or does it want to put on TV shows of quality, which make people think? It has already put up sterilized, dumbed-down and edited Japanese animated series.
Yet, even edited Japanese animation appears to have had a profound effect on many young Americans. If the US can be convinced to select quality stories, then I am all for more accessibility.
However, I would like to point out that the US stereotype of Japanese animation as being purely high-tech and violent is a result of whatever selection process brought the animation to the US. Since I am pretty sure that it's a skewed sample (having seen the far greater variety of material in Japan), I'm worried that good Japanese animation that isn't centered on violence (etc.) won't make it to the US.
On the other hand, I know that some Japanese animations contain unnecessary nudity that American children aren't brought up to be able to handle well. It may be adequate to apply the same editing standards as are applied to Prime Time TV in the US.
Generally, I much prefer subtitled animation --- but then again, since I can keep up with a lot of Japanese, I may be slightly biased. I have seen some subtitling that is just plain wrong in places --- even on commercial video releases.