Remember that Knack 2 is not really targeting the same people who play Call of Duty, on average. Yeah, there's going to be some overlap, but I imagine it's running counter to many of the other games. It could release in December, but I wouldn't be surprised if it releases before that, especially for a Black Friday family game.
As far as its quality goes, I'm looking forward to it despite not liking Knack.
I couldn't even finish the first game because it became so repetitive, but it started off with such promise. I liked the growth/shrinking concept, I liked the gameplay at first, and I liked finding secret chests. The lack of platforming wasn't even a huge deal for me (though I don't mind additional platforming in the sequel), but because your attacks didn't evolve or change, I felt I was doing the same thing to every enemy, and it eventually got to the point where I simply turned to another game and never came back.
Knack 2 looks to alleviate that so far (I hope its gameplay improvements can sustain a whole game, which I think it can and hope it will), plus with co-op and puzzles and interesting platforming? I'm down with that. Hope it turns out well because I'm totally down with its concept and potential.