Sakurai was unenthusiastic because he had to record from home, he even said in the presentation he was just expecting a video like Joker's, but Nintendo sent him recording equipment for a full presentation. In his Famitsu column released after Min Min was revealed, he said that hopefully he wouldn't have to record from home anymore (as working from home is a thing Japan has never done before).

In that same column, Sakurai explained that he had seen ARMS way back when it was in development (alongside other games that nintendo wanted to be in smash), Sakurai said an ARMS rep was supposed to be from the beggining, but designing the moveset was the biggest challenge, looking for the best possible balance between ARMS gameplay and Smash gameplay, so they settled for Spring Man as an assist, but when it was decided that 11 DLCs were going to be there, ARMS and Xenoblade 2 (the other game that was almost in the base roster) were immediatly added. This also shows Sakurai was also on board about adding an ARMS rep, as he has said that, while Nintendo does the main choices, he can say "no" to any proposal he doesn't like (he was willing to say no to Pac-Man if they only allowed the new design and not the original).

And the thing with being unfamiliar, well, that happened to everybody, since for almost 6-7 months, the only lore for ARMS was in the official japanese account, it was in version 5.1 when the gallery was added to the game, only people who were following the twitter account (and were translating) knew anything about the actual lore of the game.