Actually I think Square-Enix may have switched (no pun) to Unreal Engine 4 to accomodate Switch versions of games more easily.
Why would you spend so much money on the Luminous Engine and never basically use it again?
DQXI runs on Unreal Engine 4, that's likely why they can make a Switch port of it, FF7 and KH3 also use Unreal Engine 4.
I think Switch will get the bulk of Japanese support, but only about 30%-40% of Western support. And that Western number will drop if the first batch of games don't sell well.
To be honest Kingdom Hearts III really doesn't look that much better than Dragon Quest XI, so if that can run on Switch, I'd guess the other one could too. It would take some work, but Japanese devs are more likely to be willing to do so given the Switch is likely to sell well in Japan.
