I'd say he has a good chance for the next fighter pass, but if he isn't apart of the next two I at least expect a Mii Costume.
That being said I do believe Banjo and Kazooie still has the edge over Steve due to Microsoft expressing previous desire, even if it really is up to the board of directors, that and I mean... there is specifically RARE spirit data, not spirit data for Microsoft in general. RARE spirit data alone only makes sense if Banjo and Kazooie (or Conker for all we know) join the battle and the alternative was Chief since he's the fave of the company. Wouldn't make sense for Steve to be joining and RARE spirits to come with him. That said as I've said it before and I'll say it again, he makes the most sense as an assist trophy, though I will say a Steve Mii Costume is just as likely and I'll say Steve would probably have the one that looks like him the most.
That also being said, I think some people have forgotten irrelevancy doesn't mean you're out for the count and popularity doesn't mean you're guaranteed either. We've had plenty of fighters and instances where this was proven wrong, the most notable being King K Rool's inclusion and the absence of popular characters like Waluigi, Shadow, Krystal, Bandana Waddle Dee, Paper Mario, etc. etc. from the playable roster. Of course we all know King K Rool got in due to popularity, popularity within the smash and DK communities, but that just proves the popularity of an irrelevant character can get them in over someone with more relevancy. Pretty sure we all know Banjo was a toprunner in the ballot so it's very much possible NoJ took that into account when they picked their selection for Sakurai to chose from. Which brings me to another point people here seem to skew a lot: NoJ didn't pick five fighters and force Sakurai to make them, it was clearly stated that they picked a handful of characters and presented them to Sakurai, who then decided which characters to pick from that selection based off if he could think of a move set for them. It wasn't the "We picked five fighters for you, here they are and now go make them" situation most believe to be the case. As Sakurai has stated before, he also likes to imagine the character "dancing" in his head before coming up with a moveset as well, not anything like money, popularity, etc. etc.
Anyways, I still agree this is basically a deconfirmation for chief or at least a 99% chance of dencofirmation. But based on that information I just gave, I challenge you guys to think in Sakurai's shoes in this scenario: Banjo and Kazooie, Master Chief, and Steve were just presented to you, just some images of gameplay from their games (and if you want just official art printed out) and as unbiasedly as possible imagine them "dancing" in your head, make sure to get any scenes from their mods of them being model-swapped out of your head, since Banjo and Kazooie wouldn't move like Mario, Chief wouldn't move like Falcon, and Steve wouldn't move like any of the Links. Just them and their animations from their actual games and tell me in an ordered list who "dances" the best?
The third datamine spirit data presents the spanner in the whole "Rare spirit thing" works; it's Devil's Third, owned by Nexon (ArcheAge, Maple Story etc,). I don't mean to be rude, but I don't think Nintendo talked with Nexon - otherwise that would be one hell of a dark horse.
As for the Sakurai question. It's complicated, probably. We know he likes both MineCraft and Halo 2 (he probably doesn't mind Banjo-Kazooie either), but each character presents its own unique advantages and drawbacks. All three are really strong choiches, so I would not be surprised if Sakurai wants all three, one by one (I'm going to focus on drawbacks since those probably played a major role in choosing the character):
For Banjo-Kazooie, the big advantage is that the moves to draw from are already there. They just need to be reworked into a Smash context. However, the problem arises with Kazooie and animations. Most of Banjo's attacks rely on Kazooie to poke her head out of the backpack (and get back in once the attack's finished, adding to start and end lag*) and do stuff. Spit out eggs, barge forward, peck three times etc. How much start-up and end lag is enough without coming off as unnaturally fast or unbearingly (hah) slow? While Ultimate's balance is the best it's been B-K can also become a balancing nightmare. Either the Kazooie attacks are safe and are going to zone people out for days, or they're unsafe and whoops, Banjo's getting punished hard from a whiffed egg attack. The biggest difficulty is not insurmountable, but can give B-K a stinging negative reputation post-launch as "Another Belmont". While B-K might be easy to create, they're not easy to maintain, especially going into Smash 6 and beyond.**
For Master Chief, he has Snake's advantage of having tons of weaponry. I think though that Sakurai wants a bit more tíme to figure out ways and design FPS characters. That's new ground for him. How do you readjust the Energy Sword, notorious one shotter as it is, into Smash, for example? Or how do you work the various weapons in? If I'm Sakurai I might look at Doomguy as testing grounds for Master Chief down the line. The two may share a genre, but have a lot of differences - still, Chief can be built using Doomguy as a very loose base. Doomguy's much simpler and direct of a FPS character after all. Still, 343 might've pointed out what
Schnee117
did, that the Assault Rifle can fire Hardlight instead of kinetic bullets, so that's not an issue really
For Steve, he doesn't just have weaponry, he has tools. And not just tools-as-weapons, but he could do almost anything. Which is the design problem too. Where do you start? Terrain manipulation? "Mining" minerals as buffs for oneself? Summoning and building new stuff? And not just balance issues, but which to use and how they should complement each other without breaking the game like a twig. That question might be enough to put Steve on the back-burner for now, while the team figures out what to focus on.
All in all, if I'm a betting man I'm putting 50 / 50 odds on one thing: That talks for a Fighter Pass Season 2 has begun and is being considered as we speak. Depends heavily on if Sakurai considers such a load too much, but he was relieved when he got his weekends off this Fighter Pass. And Smash is his love child. So I could see it - and one of the two who "lost out" for now.
*(This is part of why I'm opposed to the Talon Trot being a move. That and there's not much B-K can do going out of it in their games - in Smash, that's ample grounds for the opponent to punish.)
**(The reason I keep harping on that is because the day Smash 6 releases will - someday - come IMHO. Not a concern now, but eventually.)