New Pokemon Names | Bulbagarden
There's nothing wrong with a few of interesting names here and there, though. You can get away with it sometimes, but not all of the time. Since we're talking about names and I recently messed around with them, here's an example of the thought process.
I was going to go with the latter, but then we go to the form before this: numero uno. I originally had it as Flyvern. It was probably one of the better ideas, but someone said it just sounded too "big" (it's a dinky little fly). Gnagon was suggested, but I thought that sounded too close to naggin'. So I transfered -long over to it, briefly thinking Flyu/Fryu before kicking myself because both look and sound stupid, so it became Gnatong. With that used, I decided on the former. But now we jump ahead to the final form - in short, a giant fucking dragon. In the painful task of getting a duality I based its tail partially off the flesh fly, and wanted to work in Sarcophagidae, hence the -ae.
I had stuff like Hyphagidae, Fafnagidae, Zburagidae, and so on. The best was probably Azagidae. An expanded Azeburidae I threw out for being too big of a mess. Then I decided to double up on mythology and use Beelzebub. Beelzomok I threw out because zomoks are pussies, Beelzmok just looked bad, Beelzahak I considered, and I also thought about Beelzilant. Someone suggested Beelzazel, so we went with that.
With that in mind, I tried to re-implement the -ae. But since it looked bad, I just dropped it, and thus it became Entyrid. I thought about the more obvious Entyrmid, but that looked bad as well.
So yeah, that's what goes into it. In summary, a name needs to fit the Pokemon, and it needs to look and sound nice as well. It doesn't necessarily need to be a complicated mess, either: on the same thing there's also an icy mountain goat who got named Chillbilly. Sometimes, brilliance can emerge from simplicity. For the former reason, it also helps if you get the Pokemon in your mind before you assign it a name.
Going back to "Lutis", ask yourself - is it extravagant enough to warrant using the complex name as part of it? What is this otter about, what makes it different from the other otters and otter-like Pokemon? Maybe you can decide it's worth it in this specific case to differentiate it from Dewott? If it breathes fire, you can go Lutrindle or Scalutra. And once more, it's not good to use the big words all the time, or to be different just for the sake of being different. You need to find what works and what doesn't work - in this example, the science would be fine, since Hottar is a dumb name. But would it be necessary for the squirrel?
Anyway, there you have it. Summary of summary: making a good name is a pain in the ass.