So the DLC were considered back when the project plan was made? That... surprisingly fits one of my theories if true.
Starting to wonder if some of these characters were planned but got pushed to DLC for time constrains/3rd parties wanting more money.
I have a hare-brained theory about the Square Enix situation. I must note, this is only conjecture on the current narrative and not necessarily the only one I think is possible.
-It's late 2015. Sakurai is putting together a basic plan for Smash Ultimate. Pretty much everyone is invited back who worked on Smash 4. Sakurai asks Square if it's okay to expect Geno and Cloud for Ultimate because, after all, he's already gotten permission to use their assets before. "Sure, why not?" There seems to be a mutual understanding and things go forward from there.
-Fast forward to after Ultimate began development. Some basic things have been made for Geno. Maybe a working model and some spirits. Sakurai goes back to Square for Cloud stuff. "It's cool that you're letting Cloud be DLC again." "Nani dafuq?!" "Yeah, I thought we agreed on this..."
-Sakurai's idea was probably to have Cloud and Geno in base like Ryu and Ken and all the previous DLC characters. Square probably argued for Cloud to be DLC because they figured he'd make more money than Geno. Sakurai's not having it. "Look man, Cloud's a big deal. People would happily pay for him again." "Yeah, so? I love your mom but I don't expect to pay EVERYTIME I want to have a good time with her!" People get pissy and negotiations go south.
-Square at this point is threatening to pull out entirely. No Cloud means no Everyone is Here. Sakurai: "Why can't you be normal?!" Square: *screams in money* It's super tense. Square is deaf to any other suggestions. Sora is unfortunately given a cigarette lighter and a potato peeler by Square and told to eat a hot slice of their ass and shown the door when he's suggested.
-An agreement is reached: Cloud in base, Geno as DLC but all the negotiations mean work has barely budged on Geno, offering a possible explanation to the alleged empty fighter data that was totally scrubbed in the base game (another theory made by others is that this was supposed to be Chun Li). Cloud is one of the last if not last veteran to return, matching narratives we've heard. The SMRPG spirits are kept but the fight was so aggressive that they don't liscense old artwork for Cloud. All FF content is pretty much copy and pasted from Smash 4. Square isn't super happy with the decision but they still get paid DLC in the end. Sakurai probably wanted Cloud and Geno in base, probably to go along with fan favorite reveals like Ridley and K. Rool, but whatever; one less DLC character to think of. It's a workable compromise either way.
This narrative possibly explains why a Square rep was known since the summer and why it's very heavily implied to be the first one to be out of the gate. This also goes with the narrative of Polar Panda's source's sources talking about a Geno rumor, Jon from GameExplain's unusual confidence in the character as far back as September, why Geno was the only character aside from Ken in the Grinch Leak that insiders and even admins on Resetera didn't heavily deny or dismiss (to clarify: to ever be in the game as playable or planned), etc. Again, this is just one possible explanation for things that have transpired so far and just based on bits of pieces that have come up over the months.