I just read some well-informed and interestind discussion on this on another forum. The short version I gathered from that board is this:
Ninja did not use straight-bladed weapons (myth).
Katana mystique stems from a few factors. For one, they were the weapon identified with Samurai - even though they were usually a weapon of last resort, only the Samurai class could carry one without being Ginsu'd. For another, the folding we hear so much about was primarily because the Japanese have crappy metals - the folding removed impurities and made the metal useable. Late 1800s/early 1900s writers also wrote about the Katana, Bushido and all things "traditional" with a growing nostalgia and revisionist inclination.
Anyway, the katana is primarily a slashing weapon. It could slice through bone and flesh easily. Against metal, less effective - no 1-handed sword is ideal against armor (some two-handed ones use a stabbing technique to get through armor). It was not ideal as a piercing weapon due to the curvature of the blade (length and curve varied GREATLY by period, by the way), but of course a warrior wouldn't waste a good killing shot if the opportunity presented itself.
As to hardness and sharpness, the blade could not be too hard or it would shatter easily. Myths of testing sharpness by dropping a cloth or scarf on it are pure fantasy - no weapon that sharp would keep its edge unless it was far too hard (and brittle!) to survive combat.
The katana was the best sword in the context it was used in. Certainly they were wonderful weapons. The weapon would have evolved quickly had it ever had extended use against the armors common in Europe. It did in fact evolve in Japan as well, with different eras producing weapons of varying curvature and length.
/end summary.
THIS is D&D man. Make it a 2d10 1H martial keen vorporal weapon if you want

But, uh, yeah. MW bastard sword is about right in game terms in my opinion, and the book I think even says this.