The word baphomet today has a long history which is so far removed from its etymological origins as a bastardized mistransliteration of the name Mohammed that, in my opinion, I don't think it would be an issue. No one would recognize it as such, and unlike modern (1800s and on) racist and xenophobic terminology it doesn't carry any real sort of toxic connotations. So I think it would be fine.
Baal isn't a bad choice either if the character is Middle Eastern, which I assume based on the sketches you've posted, since Baal was a Near Eastern name meaning "Lord", in the godly sense, and was the common title of the Near Eastern/Caananite thunder god Hadad.
Btw, just to give my own take on the scope of the project, your ambitions and the reality of getting to a finish line, I would set my ultimate sights on getting two, maaaaaybe three, characters with vanilla SF2 levels of moves and mechanics (ie, like 2-3 specials at best) with 1-2 stages, and primarily focus on getting one character moving around, throwing normals and hitting something to all feel really good before moving on with more elaborate ideas (like systems-level mechanics and more than one character). Just that on its own is still a long, complex and challenging process.
Even if your ambitions contain 4, 8, 12, 16 or 20+ chars, and you don't wanna entertain the idea of making sequels. Then treat it like SF2. That 2-3 char base game should be your vanilla SF2: The World Warrior.
Anyway, best of luck.
