@BattleFranky69:
To me the literal meaning of this is, he parted company with his arm, a la Perospero losing his arm in the explosion. Because the arm and body are attached. You can stretch your arm, sure, which Luffy can do because he's rubber but it all still remains attached to the main body. So that already makes no sense as a defense.
If for some reason doing that from his primary body was necessary as opposed to summoning one out of thin air like he's done with the majority of his attacks, he sacrificed an arm to do it if he's not an actual Logia, which I've been bitching and moaning about since we found out what his DF power is. It makes no sense that it's not a Logia, and there's zero reason for Oda not to have just allowed for that.
So now he and Perospero no longer have an organic arm, but one made up of whatever substance their DF produces. If he's not a Logia. One little change of a word fixes all of that. But we've seen this kind of inconsistency with Katakuri's character so maybe Oda's just got some weird mental block about him. On the other hand, him purposely handicapping himself again out of some misguided sense of superiority might make 'sense' given how he's made such a bizarre personality 180 already.
I look at it like this.
Special Paramecia - Your body is permanently changed. Luffy could very well be a special Paramecia. Only Katakuri's ability allows him to create Mochi and his awakening probably allows for the absolute control over it even after its created in the environment.
Katakuri heated his arm and launched off excess mochi. Knowing that he can be split apart and be rearranged falls in line with this ability. So another arm growing it its place is no different than seeing his body riddled with holes and then forming back together.
It was probably originally intended to be Logia but then allowing Katakuri's CoO to be so good that his fruit appears to act like a Logia is pretty darn cool to me. Plus this allows Luffy to overcome something overwhelming that Armament alone couldn't fix and gives a good excuse for Luffy to grow in his on Observation. I feel like it worked out for the better.
As for Luffy's awakening he will probably change his environment but I severely doubt we will see him controlling the rubber material like a Logia on any level. I guess it sounds kind of boring but I can think of a few instances where that could be useful. And not just useful but silly, good ol' fashioned One Piece silly.
Someone is about to be executed with a sword, guillotine, or rope hanging. The sword and guillotine harmlessly(more or less) bounce off the intended victim and maybe the weight of the victim allows the rope to comfortably stretch to the ground resulting in no hanging.
Maybe an army rushes in but the ground turns to rubber giving everyone a ton of bounce in their step. All of a sudden they are trying to run a cross a field thats like those giant trampoline gymnasiums.
Eneru comes back and tries to shock the Sunny into oblivion but alas it's useless when Luffy is around.
The Sunny is about to take heavy canon fire from all angles and there is no way the crew can stop everything at once. Sure enough bounce house Sunny manages to protect itself.
Someone or something crushes Sunny into paper ball but it manages to reform as if nothing happened.
Luffy Gum Gum Pistols someone into a rock wall, turns the wall into rubber and they keep bouncing back into Luffy's fist like some sort of Loony Toon.
¯_(ツ)_/¯