Yeah, she felt weird to add as a fighter, but she actually does take action in Amiibo Festival, the only reason I could even imagine her working in Smash. And they did take from that game, making her feel like she's treating things like a game, completely fixing the issue with her non-violent tendencies. It's more odd because she actually is a pacifist in Smash's own design from her first appearance. But regardless, she had the lucky factor of Villager existing to branch off of, since she was never there to even represent AC in general. Just an easy mascot who was highly popular to add. She was added into other games, ignoring her more pacifistic tendencies, too. Mario Kart was a good move, since it was party-based. She only actually didn't fit in Monster Hunter, which is a highly violent game. Smash she works cause it's party-based.
It's the reason why if only one AC character exists, it's going to be Villager. He/she's the franchise representative. Being the mascot(which Isabelle is being pushed out by Nook again lately) isn't enough. Representing the core gameplay helps more. He was chosen before Tom Nook for that exact reason. If he couldn't beat him/her as the core representative, Isabelle has no chance either. Nothing changed in that regard. Though first come-first serve is also highly important too. Ease of creation has its point. Hence, PT never stood a chance anyway. Pikachu is odd too, since the intro suggested he had a trainer(just wasn't in the bg) and came out of a Pokeball. Only reason it reasonably represented Pokemon well, since the Trainer is technically there. Not as well done as PT, as a concept, but the Trainer and Pokemon is the core gameplay of Pokemon. Without it, Pikachu just had a working moveset from the anime, but other than that, really didn't represent Pokemon all that well beyond that.