I hope you don't mind this being posted late, but I don't want to leave you hanging for questions.
1. "What kind of interesting things can you do within the structure of the game?" Is it referring to the character's game or Smash, because I think he already knows Smash's game structure. It makes me think that the second last and last question are basically repeating the same thing.
Basically this is a question of "How can we translate things this character is famous for doing, or interesting things they can do in their home game?" Almost every character has a few moves which they are famous for, like Link's spin-attack or Kirby's inhale, so it's important to consider this stuff when implementing the character.
Game play style of how they play in their own game, too, can come into play. F-Zero has a very fast, high-risk, high-energy game play, and so does Falcon. Much of Marth's game play is tied to certain game play concepts in his own game (counter attacks, being able to attack someone a max of four times, etc.). Kirby games and Kirby himself in smash is geared toward beginners. Things like these help to develop an idea on how a character should play.
Characters embodying concepts from their own games allows them to do things that technically aren't cannon to them, like how Ness can use PSI moves from his other party members because he represents Mother's combat as a whole, or how Robin can use Dark Magic even though he can't in the class he is presented in.
2. Should not "What kind of interesting things can you do within the structure of the game? And then if you were to actually implement that character, how would the end result be, how it works with other elements of the game?” be the next questions asked, with "How do those work together with each other?" being the last question. Finding the character's role with the next step being "How do those work together with each other?" seems way too early.
Comparing the character's role in game play to Smash game play structure as the second step seems kinda off to me. Would it not be less about how they work together, but whether or not the role they have is distinct? What questions are even asked to build up the connection of character role to Smash structure?
To be honest, it could be that Sakurai was just spit balling and not saying any questions in a particular order. It could be juggling several different questions at the same time, and we're over analyzing him yet again...
However, I think we can all agree that a character in Smash should play somewhat like their own games. If a character is given a move set which seem totally at odds with how they are usually portrayed, than something seems off.
For example, we could make a move set for Ridley that has a heavy emphasis on spacing and keeping away from the opponent. He has flight, so it's easier to run away and keep at a distance, and the fire breath and long arms give him great reach.
But that wouldn't be Ridley, would it? You'd expect Ridley to be a fairly aggressive character who is in the thick of fighting. He should have this intimidating presence, charging in. Though Ridley has the tools to be a zoner, that's not a fitting role to him and should be avoided.
Characterization is an important part of translating a character to Smash, and Sakurai tends to keep characters as true as he can to their games.
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