I assume his tweet from Nov 7th was translated professionally, but I can tell you what I read from the Japanese. I'll try to make this as literal and clear as possible.
『スマブラSP』ではDLCを作りますが、その内訳はすでに確定しています。
DLC will be made for Smash Ultimate. The content has already been decided on.
今回は任天堂が全てラインナップを決めてきており、
This time, Nintendo made the decisions regarding the entire line-up,
私はそれを作れるかどうかを判断し、企画しています。
And I decided on whether or not the character(s) can be made, and also do the planning.
It's pretty much the same thing as what's been posted in English. There's no way to know the process from this. They could've showed him a list, they could have presented the characters one by one. It could have been any number of things.
Personally, I think from the wording, Sakurai's decision making came down to telling them if he could make a character. I don't think they wanted to know if he personally wanted the character in the game. Kind of like "Sakurai, we want Joker. Can you make a character out of him?" If yes, they went with him. If no, they moved on. I think the word "selection" is making people think Nintendo gave him more of a choice.
The implication of the tweet most likely goes like this.
- Nintendo picks the characters
- Sakurai says if he can feasibly make those characters
- If they can't be done, Nintendo picks someone else
Rinse & repeat until the Fighters Pass is finalized.
So basically this.
Edit: Now that I think about it, the Japanese is even more vague than the English lol definitely not getting more information out of that.