If owns initiative yes, it can. Shisui basic meta heavily depends, in arena, on owning the barrier buff and clones will eat itachi anbu standards and are potential targets of shisui standard too (if hits one of them doesn't hit one of the other 3 ninjas)

The number of stars in arena matter only to determine the skillset of the ninjas, not the stats. That means that a 2 star yugito nii or rasa in arena is the same as a 5 star version of them, but, for example, a 2 star guren or kushina is not the same as a 3 star version because change the skillset (guren gets evasion, kushina immunity to debuffs). Anyways, also in this case, hp/atk/nin/def/res does not change. Only the skillset change.

Kisame samehada or madara 5th summit is the reply. Now that itachi breaktroughs are available also him + han/edo yugito nii is an option to beat that team (with water main)