Yep, Tokyo is an fantastic place to cycle... and I hardly ever cycled on the pavement. Serious roadies tend not to, but those riding mama-chari (shopper bikes) almost always do. The legal situation is a bit weird, in that it is legal in some places but not in others, but no-one really seems to know where. Cyclists are generally not allowed on the highway on road bridges, but there's usually plenty of pavement, if not a separate bike lane. The only major problem I've encountered is that many people also ride the wrong way on the road. I've seen so many close calls (and I've also almost taken out some idiot doing this on several occasions). However, drivers are almost always polite* - I think I have only ever had three incidents of abuse from drivers in the all the many months I have cycled there. And of course there is very little chance your bike will get stolen.
But the three really fantastic things about cycling in Tokyo, if I have to pick just three are:
1. The amazingly steep (and I do mean, really steep) hills and tiny streets in the central residential neighbourhoods like Bunkyo and Toshima-ku;
2. The riverside cycling and running routes that stretch along rivers like the Arakawa, for miles and miles out of Tokyo;
3. Cycling at night especially in summer, when you can breeze through the thick humid air, through the neon-lit streets from one superb characterful izakiya (little pub/grills that do sake and a selection of tasty food cooked by the owner behind the bar) to another.
I miss Tokyo.
*and this is why Britain couldn't just learn cycling policy from Tokyo, because fundamentally it's about a different attitude to society and other people - and a different kind of urban landscape. There isn't any particular cycling policy in Tokyo - except perhaps the parking for bikes - just manners and a city whose layout makes it more convenient to move around locally by bike.