I finally figured this out, but am surprised how difficult this was.
1. I have an original iPad Mini, which I keep up to date. Currently IOS 9.2.
2. My wife just gave me my Christmas present early. A new iPad Mini 4. Yay!
3. I naturally clean up my iCloud storage usage, clean up my old iPad Mini, and make a new iCloud backup.
4. I plug in my new iPad Mini 4 to power, and start the setup process.
5. I get it connected to my Wi-Fi.
6. I choose to restore from iCloud backup.
7. The list of backups to choose from shows my latest one, but it is greyed-out, and says "Requires IOS 9.2".
8. I go back, and choose "Set up as a new iPad". I don't want to do this, but it is my best choice.
9. I go through the setup process like it is a new device.
A. It prompts me to upgrade to IOS 9.2, so I do that, and reboot when it is done.
B. I log on, and confirm I am running IOS 9.2 on the iPad Mini 4.
C. Now I struggle a while, trying to figure out how to get back to "Restore from iCloud Backup".
D. I find in Settings, General, Reset, and find 6 options.
E. Only the first two sound like they might get me back to "Restore from iCloud Backup".
F. I worry for a while that both "Reset All Settings" and "Reset All Content and Settings" will revert the IOS version to before 9.2.
G. I try "Reset All Settings", because I don't yet have content to worry about.
H. I log on again, but it doesn't seem to have changed anything. I wonder what it did.
I. I try "Reset All Content and Settings". This appears to nuke it back to "Hello", like right out of the box.
J. I start the setup process over again, and choose to "Restore from iCloud Backup" again.
K. This time, my recent backup of the old Mini is listed as available to restore from.
L. I choose the backup, and it appears to be restoring as desired.
1. The new iPad Mini 4 needs the update to IOS 9.2, before you can restore a backup from IOS 9.2.
2. Clues about the problem (step 7 of the Scenario above) are presented, but the solution is not obvious.
3. Some people won't figure this out.
4. When I tried the solution (steps 8 through L above) I felt like I was just grasping at straws, and gambling that I wouldn't be reverting IOS.
5. I feel I was forced to do some configurations 3 times.
1. Why not allow a new device to get on Wi-Fi, and update to new IOS immediately?
2. In the "Are you sure?" pop-ups for the "Reset..." flows, why not mention if the IOS will be reverted?
1. Is there a "Restore to factory state", which would revert the IOS to the version the Mini came with, out of the box?