Arguing that Kaioshin knows Yakon based on rep is meaningless, completely meaningless. It's essentially a cop-out and it requires too many assumptions. Like 'How does he know him?', 'Does he know how strong he is?', if so, how? When? Evidence?
There is none.
And there is no evidence to support the argument that Kaioshin knows how strong they are before they became Babadi's underlings. Kaioshin can't sense them either. Which brings us to another conclusion, even if he knew Yakon based on reputation that doesn't mean he knows how strong he is, he only knows what he heard. Which can be contradictory towards what he can do.
But leave it to Evil Vegeta to come up with illogical reasons to disagree with Tosh, simply for the sake of... well... disagreeing.