Yes, the meat is eventually labeled as whale meat from a different, more sought after, species and purchased at supermarkets, high levels of mercury notwithstanding. The animals are slaughtered in a brutal manner, at a rate of about twenty thousand individuals annually. The film, The Cove, alleges certain facts that seem to be in dispute - such as that dolphins are culled before the slaughter to meet the needs of places like Sea World and dolphin petting sites around the world, supplying them with dolphins for their purposes. Evidence is not immediately apparent and these places deny it. Yet, overall, images captured let the film speaks for itself and are not open to dispute. See the film, visit the site if you love dolphins free in the seas.
One comment in the film by one of the Japanese fishermen was a rationale to the effect that while in the west we eat cattle, here they eat whales, dolphins, and other creatures. A great observation, when divorced of its intent to justify the practice, since in both the west and the east it seems that socio-culinary traditions have spiraled out of control and certain acts are referred to as if historically based by those who practice what is in fact very far removed from tradition.