Hakumen can actually do some damage with 2 stars, not great, but good. And I didn't necessarily mean "early in the round" so much as "early in life."
Say that arakune keeps you out for the first 20 seconds of the round, and you finally get in (You're at say... idk, 50% life at this point with like 6 stars). Then Arakune bursts at 85%. So far I think this is a plausible situation, thus far.
Then say he keeps you out some more and you're at 15% life now (and 8 stars) with 40 seconds left, and you haven't gotten an opportunity on him yet so he's still at 85%. Then he tries for risky mix-up and you predict and get a 6B CH into Mugen. Then you can infinite him to death for a win.
Sure that's a lot of set-up. and I'm not saying play like this against arakune. I'm just saying that I feel this is a situation where Mugen could be practical, and I also think it's a 100% plausible one, especially against someone like arakune (or Nyu for that matter).