"At first they thought it was 100% guaranteed to fail."
Not just that. It was heavily pressed on them that America wouldn't accept the Pokemon designs.
"They said it was too cute. America wouldn't accept cute, it needs to be cool."
The meaning of the word "cool" that Arakawa is introducing here is similar to "kakkoii", but it's not just coolness in appearance, but also coolness of the contents to go with it. For example, you could use cool to describe someone succeeding and getting rich with effort and talent. So saying that the Pokemon weren't cool was a pretty awful way of saying it. In Japanese, it's close to calling it "dasai".
"We got that kind of opinion from a character expert as well. Although after everything, we were saying 'they're weren't an expert at all'". (Arakawa)
And so the opinions they were given at the time was that even if the gameplay was accepted, how about having the American side redesign the Pokemon. NOA had a development team, and if they wanted to, they could do large redesigning. Arakawa recollects:
"There are people there would paint graffiti on the sides of building, and so we tried hiring one such artist to draw some designs for us. But it was no good. They didn't have the sort of creativity that Tajiri-san and Sugimori-san have. And so it came to it that if we were going to do it, it had to be with the Japanese Pokemon."
Around that time, the anime had started in Japan, and Pokemon's success was accelerating. NOA was getting into a situation were they would just have to do it.
