Well, now with this LOL leak I now have 5 characters I actively don't want in the game. Atleast it's probably not real. Don't personally like League, don't like MOBA's in general, has quite literally 0 Nintendo relevance, Tencent is Tencent, and it represents almost everything I PERSONALLY dislike about modern, particularly online, gaming. Thrilling.
TBH I don't want League in Smash, but a character from it I wouldn't really mind. Kind of the opposite mindset I have for characters like MC and Sora, heh. Some of those characters are actually really neat.
Pretty much every Zelda character people want that isn't part of the main trio falls under this, Skull Kid, Midna, and even Sheik all fall under more or less the same catagory. The best comparison in my eyes though is Adeline, a popular character driven by a big fanbase who got completely ignored for 18 years for no real reason other than the devs not really knowing what to do with her.
The main difference between them and Geno isn't just that those character have managed to comeback, but then general circumstances surrounding them. Pretty much every major Zelda character (except the Capcom stuff, who knows what the hell is up with those rights and whether they just didn't do it because of how much Koei hates Capcom) shows up as playable in Hyrule Warriors, and the Kirby team is probably Nintendo's best in terms of both acknowledging the series history not just through blatant fan-service but actually BUILDING on whats already there. Star Allies was a concentrated effort to pay tribute to pretty much every game in the franchise (even if it was obviously rushed and still feels like a 3DS game turned Switch title after a year of updates).
Also the fact that all those characters you named are first-party, and still existing within a first-party universe, while Geno is a third-party character existing within a first-party universe, you know,
THE most important factor that makes him even weirder than he is.
Yes, Geno is co-owned by Square
Wait, what? This is the first I'm hearing of this. CO-owned???
So Nintendo wants nothing to do with Mario RPG, and the entire franchise as a whole really, including making ACTUAL new games (and don't bring up the leak, that ain't official yet and I don't trust them for a second after Color Splash)
M&L: Dream Team, with remakes of SSS and BIS, being released in 2013, 2017, and 2019, respectively. There's no way you could say they "don't care about Mario RPGs" with release dates like those. Sadly, AlphaDream went under in October because of their growing debt (and the remake of BIS not doing so well, despite the good scores). Perhaps pushing a 3DS title post-Switch wasn't the brightest idea.
PM: Paper Mario has always had a weird release schedule, having sequels come out roughly 3-5 years between each other; the latest one being Color Splash was in October of 2016, and yes, like Sticker Star before it, people have come out in obvious opposition to say that RPGs with practically no moves besides items, is an awful idea for an RPG for obvious reasons. People don't like it and it's not what made people love PM. The awful writing in Color Splash and Sticker Star now making tons of self-referential jokes about being paper/stickers/flat also got tiring when the title was just because that was the art style. The lack of badges and customization made the game boring. No partners except a stupid paint can or crown sticker also turned your only partner into an obnoxious nag like Navi instead of a cast of fun sidekicks.
Yeah, PM's in a rough spot, but it's nearly 4 years later and we're bound for another game that hopefully Nintendo has taken the criticisms and general failures of the last 2 games to heart. Just because we haven't gotten a game in nearly 4 years doesn't matter when even PM64 and TTYD had a 4 year gap between each other!
SMRPG: Obviously SMRPG tends to get swept under the rug because it's not Nintendo's game, despite having many first-party assets in it. The game itself is "owned" by Square, while the Mario (and other Nintendo assets like Link, Samus, and F-Zero/Star Fox vehicles) obviously owned by Nintendo. It's the very weird hybrid back on the SNES, so it's understandable that this game tends to fly under the radar.
TL;DR: You can't say they don't care about the franchise when we've literally gotten a game (remake) as recent at 2019, and PM has always had a 3-5 year gap between releases. If you don't count BIS's remake as a game, then Color Splash was still less than 4 years ago, which has been natural for PM's release cycle.
Smash Bros. is honestly the only place I can ever see Geno, or anything from SMRPG, or anything from the franchise at this point really
I agree with your first point, but ABSOLUTELY disagree with your second. Let's at least see if that rumor pans out before declaring the sky is falling/doom-and-gloom on the entire Mario RPG series. It's way too soon to declare that.
We've somehow reached the point where I think it's more likely for Nintendo to go "Oh, Smash fans REALLY want Geno, let's put him in the game", than for them to go "OH, people love the Mario RPG's and want us to make more of them and use these characters". That's what stuff like Color Splash has taught me.
You wanna know the problem? You have a dinosaur with WAY too much pull because of his past work. This dinosaur absolutely loves simplicity and "innovation". He always feels the need to "innovate" a game, even if the game absolutely doesn't need it. He asked the team behind Sticker Star, who were originally making a game just like TTYD, to change it completely, then complained about how absolutely boring it was because of his crappy innovation. If you still don't know who I'm talking about, it's Miyamoto himself. Yes, the man is a legend for his old works on the NES/SNES, and even N64 and Gamecube, but we're now living in 2020 and we absolutely don't need to force "innovation" where it doesn't belong. Paper Mario was one of the series that just absolutely suffered because of it. He ruined Sticker Star, then tried to stick with the same awful formula to see if it would work with Color Splash. It was "better", like how covering a dead skunk in confetti makes it look prettier, but it's still a skunk corpse, and as such, CS was still a big ol' turd.
Assuming Miyamoto isn't forcing his InNoVaTiOn on the next Paper Mario game, I see no reason how they wouldn't try to go back to the old system that people have been asking for and making tons of videos on. I do respect Miyamoto for the work he's done in the past, but the man has absolutely no connections to the modern day of gaming and really needs to just be consulted for advice, not having the power to completely trash development of what would have probably been a very fun Paper Mario game.
I just think it's way too soon to assume stuff like this. Yes, Color Splash shouldn't have happened and they should have learned sooner, but until we don't see another Mario RPG game for a few more years, or if they release a "Sticker Star 3", I feel like you're doomsaying just for the sake of doomsaying.