harakiri vs. seppuku
Fujiyama vs. Fujisan

Why do Westerners wind up with the kun-yomi?

Why do Westerners wind up with the Kun Yomi? Perhaps it's due to the fact that both Kunyomi and English share multi-syllable vocabularies, and therefore it is easier for some Westerners to relate to "full" bodied words, than to assimilate solo syllables. On yomis, single puffs of breath, use up their limited syllabary quickly. There are only so many available sounds from which a single utterance in Japanese can choose. The homonym-rich system can be very confusing. I should say, it is for me. Don't get me wrong, I love this language, but I admire its beauty more than I understand its sacred logic. I've studied Japanese for many years, but not having lived there, it will take many more years before I feel stable in both speaking and writing it. I've never taken so long to learn a language before. It's certainly worth all the effort.

Several interesting factors may intrude in this story.

It was apparently the Japanese military, not foreigners, who are responsible for renaming the island to Iwojima. Why would they do that?

Most military signal traffic was rendered in katakana, not kanji. (A lot of prewar military/gov't reports were also rendered in katakana and kanji, a combination that looks odd today.) Did the military tend to use -jima rather than -tou because it is less ambiguous in katakana? In other words, for the same reason English speakers say "niner" rather than "nine" over voice lines, just as Japanese speakers say "ryokai" rather than "rikai" for 'understand'?

Is it possible that early naval chartmakers or reportwriters didn't recognize katakana iwo- as the sinitic compound for 'sulfur' and therefore assumed the island name to be local dialect? Or were they generalizing from the names of other nearby islands that are called -jima rather than -tou, like all the Ogasawara Islands renamed for kin-terms: Chichi-jima, Haha-jima, etc.

I have the vague impression that small, no-account islands--like Takeshima (Tokdo)--tend to be called -shima/-jima, while important ones, even in foreign languages--like Oahu-tou--tend to get more respectful sinitic treatment. Could the Japanese military have seen Iwo as a piece of topography to defend, rather than a place worthy of a real place name? (I understand that all the local civilians had been removed.)

I was going to guess that Westerners picked up kunyomi forms earlier and from uneducated speakers, but the army katakana explanation is a good one.

Really? Katakana, not hiragana?

Katakana, not hiragana. It looks bizarre now, but I suppose that military field communications equipment, esp. teletype in those days, needed to be as simple as possible, like the manual typewriter I used as a U.S. Army company clerk in 1970-71. When writing by hand, too, katakana is more like writing block letters, compared to cursive hiragana. More legible for forms.

Somebody will correct me if I'm wrong, but I think I've seen primers from those days that taught katakana first. I believe it was the lowest common denominator for literacy.

In googling around a bit about other uses for katakana besides writing foreign words, I came across a 2006 book called Katakana Man, by RAAF veteran A. Jack Brown: "Instead of a flying career, Jack found himself in top secret RAAF wireless units. There he worked to intercept radio transmissions sent in the Japanese katakana code, which were then analysed to produce the highly reliable intelligence that helped General MacArthur in devising his strategy for the allied campaign in the South-West Pacific."

Michael Smith's entertaining _The Emperor's Codes_, about the breaking of Japanese codes in WW2, contains some images of intercepted documents, which IIRC were written entirely in katakana.
It's true that katakana is often prefered in cases where legibility is important (sort of the equivalent of English "block letters"), but I think I picked up somewhere that the main reason for its widespread usage at that time was simply that it was much easier/cheaper to make stamps* with angular katakana on them, than curvy hiragana.

* My vocabulary is failing me, but I think in the context of printing, these are called "sorts." Anyway, you know what I mean. The inky shape on the end of a typewriter's hammer that strikes paper.

Ah. Interesting. Thanks!

I've just posted a whole lot more about the former roles of katakana here.