If I understand correctly, while Obayashi indeed made the conscious choice to use the borrowed English word "House" for the title, it was still released in Japan with the transliteration ハウス (i.e.
Hausu) alongside the Latin-alphabet title, and would have been referred to accordingly in common parlance as "su" is the closest approximation to a hard "s" in Japanese alphabets. So people who refer to the film as such aren't totally barking up the wrong tree. (Here's an example of an original-release poster where both the Japanese and English titles are featured prominently:
https://www.worthpoint.com/worthopedia/ ... 1627543149).
Not sure how analogous it is, but I have no doubt some critics must have raised in the past the question of whether the title of Tarkovsky's
Stalker should be pronounced with a hard "l" to reflect Russian pronunciation, even though it's, again, a borrowed English word. In that case, it's additionally complicated because the word has such different connotations in English that it tends to give a very different impression of the film for people who haven't previously heard of it; you get far more of a sense of its relevance to the film by thinking of it as a borrowed word in a different language that perhaps doesn't quite mean what the speaker thinks it means.
There's something similarly interesting in the decision to include the "h" in the title of
Nostalghia in most of its English-language releases – it's an odd and on first glance unnecessary choice, and one can only wonder whether it's supposed to indicate that the Russian word might have slightly different connotations from its English counterpart, or if it's just a case of preferring to maintain the integrity of the original title when it's similar enough to an existing English word to offer sufficient meaning. (See also:
Sátántangó.) I actually suspect a third, more nebulous explanation: there's a desire here to grant a uniqueness in an English-language context that the English word on its own lacks and to perhaps even capture an essence of cultural background in the process. "Hausu", unlike the generic "House", can only mean one thing to English-speaking cinephiles – just as the word "House" written in Latin alphabet probably meant only one thing in Japanese pop culture in 1977. So there is a kind of mirroring of intent going on there, if nothing else.