Oh yeah, I knew I forgot something. Yeah, it would be nice for Mario to have his black overalls and red shirt and red cap from Super Mario Galaxy (it was also in Super Mario Bros. 3).
Making up palette swaps are understandable - you give characters palette swaps in case more than one player picks the same character. It is stupid to give made-up alternate costumes to characters for the sake of having alternate costumes - especially when such alternate costumes are completely unnecessary or nonexistent. Ice Climbers wear parkas, not fursuits. Why would they wear penguin or polar bear suits? You give characters alternate costumes if they actually wore it more than once in several past games. It is also stupid to give alternate costumes just to compensate for the lack of other characters (no playable Paula? make Ness wear Paula's clothes and pretend you are playing as Paula). Not to mention it wastes the developers' time trying to come up with palette swaps for everyone's alternate costumes when they have hard time coming up with palette swaps for their default costumes, let alone making up moves for some characters.
Making up moves is one thing. Making up costumes is entirely another thing. With making up moves, the character may not have enough moves from their original game(s) so you come up with moves that stay true to the character's history/personality/theme in order to work as a Smash fighter. The character doesn't need special costumes to perform their moves. Once the character makes it to the roster, the character doesn't need anything else other than their moves. The character is recognizable by what they are always wearing from their original game(s). When you start making up costumes or giving other characters' outfits to existing characters, the character becomes unrecognizable -- think of it this way, Grant Danasty is known as that agile pirate from Castlevania III and yet he is a mummy for some reason in Castlevania Judgement. There's nothing recognizable about Grant in the latter game other than the name.
The point of a alt costume is essentially just something there for fun as well as giving the player a bit more opinions in how they want to represent themself and their character. No one's going to be shocked or offended if a certain character isn't wearing what they normally are, since they always have the opition of the original costume. Yes its unnecesary, but so are the music options, and any amount of color choices beyond 4. Its just something to add some personalization to the mix, and its worked out just fine for several other games.
I'm also not saying that the alt costume should be all compensation for other characters, though I do feel refferences to them would be fine as long as the character is still reffered to as themself. (For instance, DK in Funky's clothes could work, or Bowser Jr. dressed up as one of the Koopalings, but when the match is over, the announcer is still saying Donkey Kong or Bowser Jr.'s name.)
Also what I'm suggesting isn't like Grant's situation at all, since in that game, you could only choose to play as that form of Grant, and couldn't go back to what he originally was. With the alt costumes, that's not the case, and if you wanted to play as the character's original/main look, then you could just do that. There's no technical limitation, and its just a bit of extra fun.
And in regards to your list there Arc, I guess you're going by your standards of the alt needing to show up in more than one game, but there are a few things there....
Ridley- He's been Meta-Ridley in multiple games, so that would go by your rules.
Pokemon- Well this is more Pikachu/Jiggs. They already have alt-costumes of a sort, though they are all designated to one color.
Krystal- Wait, which look are you saying she would have? Her newer one or her older one?
Also:
@ Lucario getting dropped for Mewtwo/Meowth and Ike being dropped out completely.
