I would argue that GTA is likely to be as controversial today than it was previously because we've gone from parents who are terrified of its impact on the world to people pointing out that GTA has some genuinely mean spirited and very problematic notions of what it uses to try and make its humor with. GTA is very stuck in the early 2000s culture of gaming it feels like, and that's generally for the worse, and a lot of that stuff is increasingly being rightfully called out as an issue. It's a movement in the controversy that I think has the potential Rockstar tries to make a GTA game. I think a sequel to a game that has sold over 100 million units with as much problematic **** as GTAV had would garner a lot of attention and likely criticism. And the same parents that criticized it in the past are still going to largely be around and new ones will still have issues.
But I just also fundamentally reject the notion that Nintendo is OK with Super Smash Bros Ultimate X Grand Theft Auto. We're not talking about fantasy violence and suggestive material that can be downplayed in Smash, we're talking about a series that is often incredibly grounded in excessive violence, murder, drug trafficking, assassinations, robbery, torture, sexism, racism, etc. GTA has grown so big and wide known that the second its name is said, those very specific connotations come to mind. The game is literally named after an act of robbery that can be a felony charge in the US and often carries pretty significant punishment regardless of the country. No Nintendo is not incredibly prudish as they once were and they've let M-rated games be toned for inclusion in Smash, but GTA is a WHOLE DIFFERENT LEVEL compared to anything that has been close to Smash. And I think that's fundamentally something that Nintendo would not be comfortable even allowing in any context in their E10+ Smash game.
Like the connotations of GTA are impossible to divorce at this point and you immediately bring those to the table with including it in Smash no matter how much you tone down the content itself. I think all that adult and excessive content also often times being so grounded in real world illegal activities just also pushes way past any limits. Like I don't think that M games are traditionally a huge hang-up for Sakurai and Nintendo, but I definitely see GTA as that one definitive never ever franchise inclusion (Mortal Kombat and Doom I kind of lean against for similar issues, but I won't rule them out like I will with GTA).