On the weekend I was watching a movie in English on dvd (Magic Mike) and I had the English subtitles on because as is often the case sometimes I otherwise miss bits of dialogue because a character says something too quietly, or the sound is a bit muffled or whatever (note I am a native English speaker).

I thought...wait a minute! If I need English subtitles in order to follow all the dialogue in an English language movie (my own language), is it not any wonder that I have extreme difficulty following anything in a Japanese language movie (without subtitles of any kind)....

Never occurred to me before!

Yep, and we can often mentally fill in things that we don't hear, even without realizing it. Yesterday I was watching a moving from New Zealand, and despite the fact that they were speaking English, I had no idea half of the words they were saying. But I still understood everything just fine.

Nothing wrong with some Japanese subtitles. Many people swear by the simultaeneous listening-reading method and it can really help to use multiple senses to fix words in your head. English subs however, will just override your memory of the Japanese with the stronger memory of English (except for some phrases that will eventually start to jump out, but it's just not efficient). However, don't be trying to catch every Japanese word - it ain't gonna happen! If you get caught up in that you won't enjoy the show. Try and catch the story not the words.

Helena-san no iutoori.

Though I must confess to a small dilemma. Usually either watch with Japanese subtitles at a learning kind of speed (looking up and anki-ing some words) or else aim for full speed jimaku-nashi watching (and try to contain my こだわり).

Recently, however I have been watching Moomin tanoshii ikka and find to my delight that with a bit of pausing/backtracking I can understand 80-90%.

This is not intensive backtracking, I can watch at a reasonable-ish pace. I am quite torn as to whether I should use the opportunity of a very understandable (for me) show to watch hands-off, or whether I should do what I prefer to do and go for as near total understanding as possible.

And yes, I agree that one often can't catch everything in English. With things like chat shows (which I have never watched except when I happened to be near one by accident) I really have very little idea what they are talking about even when I can catch the words. In English I mean. That is why I don't attempt them in Japanese. Adult human conversation is not this doll's 長所.

I like having J-subs when I'm watching something, because I can check to make sure I heard everything correctly (I don't like backtracking when I'm watching something).
However, for JLPT study, I try to test myself without subs, since I always take a moment to focus on the audio before I can actually hear it (which sucks on the questions that are only a few words long); I'm hoping that listening without subs will help me decrease the time I take to focus on the audio (or at least will help me fill in the blanks).