The majority of Taiwanese are the descendants of the people who lived there before 1949, not the descendants of the Chinese Nationalists who fled there at the end of the civil war. In fact, the Taiwanese were, uniquely among East Asian nationalities, relatively happy being part of the Japanese Empire and have maintained good relations with Japan ever since.
You're correct. But in practice the native people have been assimilated and the predominant culture is that of "Chinese'
Taiwan was occupied by the Japanese during the WW2 and just like everywhere else the Japanese were hated for their criminal actions. Taiwan was no exception. Today there also disputes for example the Senkaku islands.