As it turns out, the direction in which you swing the Wiimote does indeed affect the direction the ball goes. Swinging up and to the left will send the ball to the left back quadrant of the opponent's court, for example.
The Wiimote functionality is identical across all three controller settings. For the two more advanced gameplay settings that require the nunchuk, "Control Freak" lets you move your player around with the analog stick. This allows you to "hang back to smash fast shots or charge the table to drop them over the net," according to Rockstar.