It doesn't matter if others do it another genre gets away with it, since what you have to look out is Smash's own genre. Fighting games always get harped on for this, and for good reason. It usually is a pretty poor update with all things considered, and given how Smash hasn't done anything like that, it hasn't had the problem at all. The fact that it takes its time means that it is a legitimatly new game instead of some update that invalidates that old games.
Just to clarify, Smash is still a fighting game. It's simply a part of its own subgenre just like SF is part of the 2D fighter and Tekken is of the 3D fighter. Anyway, some would say Smash should do this thing because it's been obvious since Melee that the games are unfinished each time they come up. Hell, Brawl had seven planned characters and God knows what other ideas Sakurai had in mind.
With 3S, what was the point of the first two SF 3s other than making sure that they balanced things? Does anyone really play the Marvel vs. Capcom games from before MvC2? Will anyone be playing SF4 at all when SSF4 comes out? It makes the previous purchase somewhat pointless if you churn out a update after a year or so. With Smash though, each of the three games are so distinct from each other, that they are all still played, and they all feel truly different. In my mind, that's the better route to take with these things instead of just having that one final product, with each of the previous ones being unnecessary filler that works its way up to it.
Mind you that each of the SFIII games added characters to justify the release. 2nd Impact had Hugo, Urien, Akuma, and Yang became playable characters. 3rd Strike had Makoto, Q, Twelve, Remy, and Chun-Li added. As for why they simply didn't do it all at once, there are things called time constraints. This is evident by the fact that there are Hugo sprite in the first SFIII.
As for SFII, the first update made the four Devas playable, the second was as a responce to glitches (Dhalsim's teleport glitch) and bootleg updates (This is how Chun-Li got her Kikouken) primarily. Super added four new characters, particularly the fan favorite Cammy and updated the graphics. Super Turbo further balanced the game and introduced Akuma as a boss character. HD Remix is the only update to have not added anything major as the other rereleases.
MvC2 was a radical change from MvC what with the gigantic roster and the new battle system. It was a new game all in itself.
You know, yearly sports games like Madden do it much worse than fighting games. Care to explain why no one cares that they do yearly updates but everyone does every time an updated rerelease occurs for a fighting game? Just be happy that SSFIV is being released for $40 USD.
Also, don't go assuming that they do this on purpose all the time. Had SFIV not sold well enough, we probably wouldn't have gotten Super and they may not even do an update for Super other than possible patches (Chances are they will knowing Capcom).
And quite frankly, with the advent of DLC and what not, I would hope that the whole "updated balancing" excuse that several fighters can use to justify a new version could be solved for one game by patches or something.
It's much harder than that. You can't just add characters, rebalance, add new modes, and fix the online just like that. You have the risk of running into conflicting code (as mentioned for SSFIV), data size distribution limits, and just dividing up the player base radically like that.