Man, what a great reveal! I was kinda sad when ARMS didn't get a character on the base roster. I've never played it (I'll give the free trial a spin soon, though) but it looked so neat. And hearing about how the graphic novel kept getting delayed and still hasn't released only made me sadder. It's cool that Nintendo finally threw their hat into the ring when it came to the fighting game genre (yeah they've had Smash, but it uses pre-existing characters as far as who's playable, so it was nice to get a different take on the genre that used original characters), and while I've heard ARMS has a good amount of flaws, just seemed like a waste to let it fall by the wayside instead of giving it a sequel where things could be improved. And of course, Smash is perhaps the best way I can think of to give ARMS more attention. It seemed like a perfect fit, too, so I'm glad it's finally happening!
I've also been saying for a while that we're likely to get characters no one is talking about. After all, who thought we'd get Terry (or anyone from SNK for that matter) before the leak? And boom. Already, a character nobody was expecting (I'd assume ARMS got plenty of discussion in the pre-release days, of course. But now).
As far as who I think it will be, I'm expecting Spring Man. They always go with the face of the franchise. I don't think it would be impossible, though, to make a more generalized moveset that it wouldn't feel too weird if Spring Man had alts of, say, Ribbon Girl and Min Min. And look, I understand the characters all have super unique things from one another in ARMS, but I feel like it's possible that won't matter much in Smash. We have Daisy doing Peach things and Dark Samus doing Samus things, and Ganondorf is still very Falcon-y. If the fighter can stretch arms, and wouldn't look too weird with Spring Man proportions, it's very possible they'll be alts, no matter how different they may play from Spring Man in ARMS.
I'll laugh if it's Twintelle and she grabs with her actual arms instead of her hair since Ultimate seems to be on a mission to give the majority of the cast crap for grab range