Earlier quoted context omitted.
I don't know if it's completely true that English has less character variation than Arabic— as you say, in English there is a choice of upper or lower-case, with occasional changes in meaning. In Arabic, the form of a letter is completely determined by the letter it follows. It's purely a display difference, not a separate character set. There are the diacritics to think about, but outside of the Quran they are simpl…
Someone more familiar with Arabic may need to correct me, however I was under the impression that the shape of the letters is not at all affected by the letters it follows, but by their position in the word. Arabic letters look different depending on whether they are in the initial, medial, final position in a word (as well as having a 4th form when they appear in isolation). However, there are patterns of similarity…
There are patterns (17 by my count?) among which letters differ only minorly, so it's not as bad as learning four forms for each letter, but there are some additional gotchas too. For example "ل-ا" ("laa") is always written as a single character "lamalif": لا. (Bonus knowledge: that's also the word for "no". You can see it at the beginning of the Shahada: ...لا إله إلا الله <- "There is no god but God..." etc.)