Ugh, no.
The Zelda timeline is pure, unadulterated BULLPLOP. It was something Nintendo came up with to satisfy rabid fanboys who demanded a timeline, and it basically forced them to adopt this ridiculous nonsense about different generations of people with the same names to explain away obvious inconsistencies that arose through different retellings of the same basic story. It got so bad that now they've started trying to incorporate explanations on how games fit into the timeline into the games themselves, forcing them to adopt increasingly asinine scenarios and explanations for certain things.
I have no use for the Zelda Timeline. Sheik is Zelda. Period. She has every right to be included in Brawl in the same way she was included in Melee.
Well, whether you call it "bullpop" or not is irrelevant. Even if Nintendo
did just come up with it out of thin air for the fans,
it IS still there, and has been widely accepted amongst said fans. The timeline, as shoddy as it may be, has been created by Nintendo themselves, and I'd bet Sakuari knows of it. I'm sure he's kept it in mind while designing the new LoZ cast for Brawl.
But for arguement's sake, let's do it your way—let's throw out the timeline. Now what do you have? Several Zelda games that are not technically connected in anyway, aside from character similarities and one, basic, reoccurring plot (Link and Zelda must defeat Ganondorf. The rest of the story varies).
You know what that's called? A
re-imagining of the game. Now, rather than descendants of Zelda being involved in new adventures, you have the same Zelda
existing in a different way in each game. In order to make changes to the details of the game, Zelda must live and act differently. Her life has, essentially, been re-written to fir the new story. The re-imagined Zelda of Twilight Princess, due to the nature of the story, did not disguise herself as Sheik. Ever.
The Zelda we see in Brawl is clearly the Zelda we see re-imagined in Twilight Princess, aside from possibly "browner" hair. I'm not Sakurai, so I won't pretend to
know that Zelda doesn't turn into Sheik in Brawl, but I've got a strong feeling she won't. As to whether Sheik will be her own character, that's certainly plausible. But I don't see why she'd be considered important enough for that. But then, there are plenty of inclusions in Melee that made me feel the same (Pichu, Dr. Mario, and Roy all come to mind).
If people want Sheik's moveset so badly, then I would hope that in order to include it, Sakurai would just give it to another character (with modifications to fit that character, of course).