Something to keep in mind for Banjo;
-They have had literally one Microsoft-exclusive game since it was acquired. Callimg him Nintendo-only is incorrect. He's mostly Nintendo either way.
-Yes, he was being used. Just barely. His IP was specifically in use for Rare Replay, and later merchandise to obviously tie into Smash Bros.
-The fact he hasn't gotten new games at all for a long time is why people thought he had no chance. Being with a competitor further made it worse, till Phil Spencer showed up, at least implying "competitor" may not matter. Sakurai also confirmed he doesn't care about console wars.
-Minecraft and Halo were also a lot bigger. And you also had an active revival franchise at the time of speculation, being Killer Instinct. Then we later on got a Battletoads revival, which didn't help. Though I forget if that was before of after Banjo & Kazooie's Smash reveal.
-Sakurai directly advertised Banjo & Kazooie for Microsoft. That at least proves the whole idea of the character not being used is... bunk. Yes, he's used. Absolutely non-notable, but unused is different. Series is still dead, yes. But while this may be semantics, it isn't for companies. Every single third party franchise had some kind of product at the time of being added.
That's all. I'm glad a ton of characters got in~