Playability shouldn't count, for example a lot of the characters I listed could have been played in Mario Kart while stuff like Ganon weren't playable until they SSB appearence.
It should count. The problem is that not every series fits into the same peg. Half of Mario's C-list crowd is more popular than a majority of the characters in Super Smash Bros. Which is only to say that Mario has a really big cast of enduring characters and enemies. So when it comes to the Mario games, I'm looking from the perspective of the main line games. Yes, that might be a damning statement for Waluigi, but for whatever reason I cannot understand, he has become a staple in the Mario. In some ways, he's the best character to represent all of Mario's spin off titles since he began in one and has been in them all. I'm not going to really go that far with Waluigi because I don't care enough about him to continue on.
Secondary characters shouldn't be in the game at all IMO (mind you, by secondary I don't mean characters like Luigi or Diddy Kong, who are important to the series as a whole, but characters like all the Mario grunts I listed because overall to the series they are not important.)
By secondary I mean every character not playable apart from the primary character that contributes to the overall narrative of the story within their game (ie., Ganondorf, Sheik, Bowser, etc.) It may not be the correct term from a literary standpoint, but I was using the term to make a point.
Here is a breakdown of each character based upon their first appearance. Just to illustrate where I'm coming from:
Mario: Playable [Super Mario Bros.]
Luigi: Playable [Super Mario Bros.]
Peach: Playable [Super Mario Bros. USA]
Bowser: Significant [Super Mario Bros.]
Dr. Mario: Playable [Dr. Mario]
Wario: Playable [Wario Land]
Yoshi: Playable [Yoshi's Cookie]
Donkey Kong: Playable [Donkey Kong Country]
Diddy Kong: Playable [Donkey Kong Country]
Link: Playable [Legend of Zelda]
Zelda: Significant [Legend of Zelda]
Sheik: Significant [Legend of Zelda: Ocarina of Time]
Ganondorf: Significant [Legend of Zelda: Ocarina of Time]
Young Link: Playable [Legend of Zelda: Ocarina of Time]
Toon Link: Playable [Legend of Zelda: Wind Waker]
Samus: Playable [Metroid]
Pit: Playable [Kid Icarus]
Ice Climbers: Playable [Ice Climbers]
R.O.B: Significant [Gyromite]
Kirby: Playable [Kirby's Dreamland]
Meta-Knight: Significant [Kirby's Adventure]
King Dedede: Significant [Kirby's Dreamland]
Olimar: Playable [Pikmin]
Fox: Playable [Star Fox]
Falco: Significant [Star Fox]
Wolf: Significant [Star Fox 64]
Capt. Falcon: Playable [F-Zero]
Pikachu: Playable [Pokémon Red/Blue]
Charizard: Playable [Pokémon Red/Blue]
Ivysaur: Playable [Pokémon Red/Blue]
Squirtle: Playable [Pokémon Red/Blue]
Jigglypuff: Playable [Pokémon Red/Blue]
Mewtwo: Playable [Pokémon Red/Blue]
Pichu: Playable [Pokémon Gold/Silver]
Lucario: Playable [Pokémon Diamond/Pearl]
Marth: Playable [Fire Emblem: Shadow Dragon]
Roy: Playable [Fire Emblem: Binding Blade]
Ike: Playable [Fire Emblem: Path of Radiance]
Ness: Playable [Earthbound]
Lucas: Playable [Mother 3]
Mr. Game and Watch: Playable [Game and Watch]