make the array "seats" a static variable within the class(a global variable) instead of just having it in the main method.
public void seatTaken(int x, int y)
{ //change the value of a seat to taken when necessary
taken = true;
seats[x][y] = "X";
} This has no variable/array seats. I would recommend you reading about recursion. Google that, there are a lot of websites that have recursion and how to apply and understand it in Java.
EDIT: good point, Jaeusm!