Is it true Min Min is somehow the most hated character in Japan?
Amongst the competitive scene there, yes. Purely from a gameplay perspective, there's no real vitriol against the character herself:
It's partly because Min Min's really good at doing damage / follow ups etc. in a really non-commital way. Some strengths can also be opressive: outside of her ledge-trapping, she can double jump backwards or forwards instantly after using an ARM attack. Thus allowing her to either escape or follow up after an ARM attack.
Japan's competitive scene is also generally more patient than the American / European ones, and the Japanese scene features a lot more of the roster regularily. So I wouldn't be surprised if many Japanese players / viewers are worried about her gameplay being very polarizing vs. a large chunk of the cast. Yes, she's vurnerable when she's opened up and she seemingly doesn't have good answers diagonally below her (outside of Nair), but the strengths are still very much there.
Sonic's gameplay was very much hated in a similar manner amongst Western competitive players (with a similar dislikes to likes ratio regularily), especially when people first moved to online play en masse.
Larry Lurr posted a video about it
here. While he by his own admission doesn't know everything about the character, he does show a lot of reasons why (granted, cherry picked matches where the Min Min player wins, but still).
FTR, I don't think she's super-broken or anything like that - she does seem to be really good still, and at least high tier if not borderline top. The issue is with her having really polarized matchups (as flimsy as the term matchup can be). If I had to nerf her it'd be a small nerf to the ARMS' shield damage or a minor nerf to her CQC attacks' frame data (start-up specifically), so she's still potent but would have to play a teeny bit more carefully. Not both.
At the same time, we've failed over and over to correctly guess who's going to join the battle next. Of course, Nintendo isn't deliberately avoiding common predictions, they just have a different train of thought.
Not to mention, we've already reached the hype peak that these dev cycles tend to have. It can only go downhill from here if you want them to one-up Steve and Sephiroth in the same pass.
I'm not entirely convinced that will be the case this time around - Cloud was a latecomer, although the difference there is that he was not part of a structured DLC pack or anything like that. OTOH, ARMS was relatively low-key compared to Steve / Sephiroth and started off FP2 (even if ARMS is one of the new Nintendo franchises with high profile).
Don't get me wrong, it's a decently safe bet given Incin / Byleth, but I don't want to call it a guarantee when there's been some inconsistency in that regard.