I don't think a character being "canonically dead" has anything to do with whether or not they get into Smash. Ridley's been canonically dead since Super Metroid (with any later appearances being set before Super Metroid or being a clone rather than the original), Dark Samus is unambiguously dead, and Sephiroth's dead for all intents and purposes, and yet all of them made it in. (plus, there's various Zelda characters, Marth, Simon/Richter, or Snake (though that last one is just implied), depending on what point in the timeline or which game you're talking about)