An update:
After letting this radio sit to the side all of this time I got bored the other night and decided to give it one last try.
I noticed the (VCO) potentiometer inside was shifted far off center. After playing around with it and testing it with a ohm meter I noticed it was making bad wiper contact. Replaced the part and put it on a good strong signal, tuned the pot and voila stereo!
The stereo/mono switch also seemed to be dirty so that needed a cleaning.
Guess it was a much easier fix than I ever thought.
Also learned it's not Tozaj but rather Tozai. That I looks like a J on the label
I peaked all the slug tuned coils inside for best reception on AM and FM with the tuning at a station near the center of the dial.
Yes the stereo separation of those tiny speakers is a joke, but you plug in headphones and it really sings. Besides even those tiny speakers sound good for the tiny portable it is.
The audio of this little thing through headphones is really good for being a cheap radio. The AM end is nice and wide open giving clean bass and highs well up to the top 8-10kHz with a bit of usual rolloff.
FM sounds decent with little to no hiss on stronger signals. Oddly this radio will light up stereo with even the weakest signals making for the most distant stations give stereo with the obvious noise from long distance separation of the channels.
What amazes me about this supposedly cheap radio (and the cheapo brand) is how well it pulls in stations. I compared this radio to the common sony ICF S10MK2 and they are equal in reception strength, but the Tozai has much better audio through headphones even when in mono.
It seems to have a nice hot end, or maybe it's just because I really tweaked the little bugger
Anyways if any of you here see another one of these I recommend picking it up, you'd be surprised.