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From a mechanical perspective, Tsuto as a Monk allows him to Flurry for multiple, lower damage attacks. This makes him a threat to a full level 1 party without getting swamped by action priority, but not likely to just nuke down a PC or two off the top with a lucky crit.
Lore-wise, Tsuto was raised outside of the Kaijitsu household. Off the top of my head (and without digging in and searching through sourcebooks) I believe he was raised in the Turandarok Academy, which serves as both school and orphanage. While the headmaster there is a Wizard/Rogue, I believe there's a connection between him and the current or past owner of the House of Blue Stone. If I'm remembering correctly, then it's not outside the pale that Tsuto received some 'troubled kid' lessons to try and give him some discipline.
I might be wrong though. Tsuto also ran away from home and spent time in the seedier places around Varisia, and in particular Magnimar - his journey was the flip side of Ameiko, who left and lived the 'good adventurer' life. His skill with fists and feet could be more of a Brawler thing, it just wouldn't be a published class until years after RotRL rereleased it's anniversary edition.
As for bringing him over to 2e, I can't really comment as I haven't looked into the system, sorry.