I took the liberty of moving your post to Kitten Care.
All cats, even kittens, have something known as the Vomero-Nasal Organ or VMO (also known as Jacobsen's organ). It is located in the roof of the mouth with a small opening behind the front teeth. This tiny organ (approximately 1/2" long) is thought to "taste" the air and to offer the cat additional sensory information.
When a cat sniffs an odor, it sometimes draws its lips back from its teeth into a grimace. It draws back from the source of the odor, the eyes narrow into slits and the cat pauses to contemplate. It may flick its tongue, sit back on its haunches and appear to be in a trance for several seconds. This grimace is known as the Flehmen reponse and it is the cat making use of its VMO.
It is easy to see the grimace as a reaction against a bad odor when it is actually just the opposite. When a cat sniffs a sharp smelling chemical, such as those in some household cleaners, heavily spiced foods or citrus scents, it turns away or draws back quickly to get away from the odor. The Flehmen response is just the opposite. The cat wants additional information from the odor.
This is a completely normal response when you hold this kitten ... he is just getting to know your smell!
Additionally, little kittens can and often do hiss when they are lifted off of a solid surface. Many will even scream blue bloody murder. *grin* Sounds like you have a pretty laid back baby there!