Personally I didn't cause I either had my own place or stayed at friends :D in Japan I only stayed at hostel once but it was almost like a hotel with a room for 2 (we shared with a friend) and only the toilet/bathroom and some other areas were used by more people but I never met them lol. I have stayed at that scary bunk bed hostel with a room of like 10 in Korea tho, but we went there in a big group with many friends so it was fine, and would only stay there like few hours a night (were mostly out partying)

but its super cheap so it was profitable.
About the capsule hotels, in Japan many people use it, i guess it's one of the more popular places and there's a big variety, some are more spacious some are less but they are always clean and pretty comfortable I heard, also on the cheaper side. There are many other places that you can stay overnight and for relatively cheap, if going in groups even renting a full house airbnb could be pretty affordable in more rural areas (there are many empty houses and my friends did it once :D), if going alone you can try finding hosts if you are ok with sleeping at someone else's place. Many people in Japan are interested in hosting foreigners almost for free or very cheap for a night or few if you spend some time with them and have like a little cultural exchange over dinner. Or if you want a space of your own as brekker mentioned manga and internet cafes is an option too. They are called like that but instead of just reading manga or using internet you can get a whole little room for yourself and stay overnight, there's also bathrooms and showers like at a capsule hotel but you have somewhat more space. Idk if it's more comfortable though, like capsule hotels at least have beds/mattresses, manga/internet cafes you basically sleep on the floor or in a sleeping bag :D
And yeah I will probably try all of them at some point, the times I've lived/visited there I was more so stationed in one place and would just do day trips around these areas, but I want to travel and move between different regions and cities more so in that case I'll have to use various places for sleeping too.