I stopped watching Arrow out of general lack of interest a little while back, but generally speaking "canon" is a dirty word on Arrow. The only
time the Arrow writers ever care about canon accuracy is when they are robbing the Bat-Franchise blind.
I'm only surprised they haven't stolen Bane yet. I assume preemptive threats were made. Possibly with a pointed stick.
As for TV Holt, that character was introduced (irrc) when Ray Palmer was still a series regular and when John Diggle appeared in every episode.
A true to the Comic Book Mr. Terrific would have had both Ray Palmer Genius/Mogul gimmick and Diggle's hyper-competent stoic persona.
I'm not surprised they ended up doing a 180. Had they planned things better they could have introduced Mr. Terrific on Legends where he
could have been science straight man to a whole team of goofballs.