But Game&Watch has some sort of history behind it. Jigglypuff was just popular in the 1st season of the Pokemon show, she was never good/used in the videogames or trading card games. It just makes me question why from the original 151 why did Sakurai pick Jigglypuff?
You answered your own question. Jigglypuff was already very recognizable from the show. I mean in Red/Blue, Pikachu is not a featured character at all. He was still the mascot of the franchise due to Nintendo pushing Pikachu in marketing. The same thing happened with Lucario and now Greninja.