I'd say Sakurai tries to meet his Western/Japanese & Casual/Competitive fans in the middle, not necessarily pander to either or. If you want to argue how successful he is at doing so that's fine, but that all comes down to personal opinion.
Sakurai has however stated in the past that Smash is a good vehicle to celebrate and promote Japanese games. Given the focus of Ultimate however, I think now is Shantae's best shot of getting in. I tend to disagree on her being a lock, but I do think that if she's going to get into Smash, the situation surrounding this iteration is so far the most favorable.
All that said I do want to address the non-Japanese characters we've had in the games.
As others have pointed out, while Diddy, K. Rool, and Dark Samus are from the English Rare and American Retro Studios respectively, both are still Japanese franchises.
Third parties as trophies and assists such as Shovel Knight and Rayman while created by western devs, still had their games published in Japan directly by Nintendo.
Even Commander Video, the indie who got a trophy in Smash Wii U, had his games published by Aksys that while based in CA was still founded by a Japanese developer who is in regular contact with other Japanese devs hence their primary work on translations and close relationship with franchises such as Guilty Gear.
All that aside however, I don't think this bars western characters from getting into Smash, it just helps if there are some ties to boost Japanese exposure. And while it is a bit more of an uphill battle if they're not big with a Japanese audience, I believe the bigger key here is still the relationship with Nintendo, something Shantae and WF have had for years and their current relationship with another Japanese dev, IntiCreates (who also regularly develop games for Nintendo platforms), might prove useful as well.