Several people have radiation sickness from high exposure already, high doses have been recorded up to 40km away, and radiation kills long term (unless it's a massive dose), so that's not a very useful statistic. It is useful to know what levels of radiation have been released.
All of these points are, I believe, at least hyperbole, and at worst outright scaremongering.
While it's true several plant workers have been taken to hospital for monitoring after receiving acute doses higher than safety recommendations (>100 mSv), this is many times lower than the typical onset of "radiation sickness". The safety threshold is chosen as the limit of detectability for increased cancer risk over a lifetime, which puts it on the order of 1 or 2 percent increase in lifetime risk of cancer. Given they're doing very valuable work, this is not that dramatic a risk - the risk to other emergency responders in the wake of the tsunami is probably much greater.
With regards to the "high" doses 40 km away, these need to again be put in perspective - it is "high" compared to the local background (although often only 50 to 100% more than usual, barring localised spikes), but there are places in the world where natural radiation is almost 100 times greater than the typically quoted "background dose", and people live there just fine. Combined with the fact that most of this radiation is short-lived Iodine isotopes, a ballpark estimate suggests that people living outside the plant would only see a dose of 1 mSv or less by the time the iodine had decayed away, even if they ignored all the simple safety precautions which can be taken to reduce that further. These doses are well known not to cause any significant increase in cancer risk - long term or not.
And your suggestion of a Chernobyl-style sarcophagus being required is still rather unlikely. Since it appears none of the reactors have actually melted down or suffered a substantial failure in containment in the immediate vicinity of the rods themselves, it's quite likely that they'll be able to take them through a more or less normal shutdown and decommissioning once proper cooling is restored, and the storage implications will be no more serious than if they reached their natural end-of-life. Indeed, if they weren't already near or past their expected end-of-life, they could probably be fairly readily repaired, refuelled, and set running again within a relatively short timeframe. (Indeed, there's talk that this is being considered for Reactors 4 through 6, although that may turn out to not be politically viable).
I'm not denying it's a serious issue - but in the perspective of tens of thousands dead, and many times more homeless and short on food and other supplies, it really shouldn't be dominating headlines in this way.