While I would have loved to see Banjo and Kazooie appear in Smash, especially during the Melee and Brawl days, I think it has gone well beyond their time to appear. Microsoft has not done anything new to bring the bear and bird back into the spotlight to make them a favourable consideration, really having only dragged their name through the dirt along with Conker. I get that they were a
huge part of the N64 period, I loved both games and play them still now, but I unfortunately just do not see the value in bringing them back, especially since Microsoft would be the ones to mostly profit it off it as any new purchases of their games would be on the Xbox (
*shudder) and would only be helping them make a new game, it is not really a priority for Nintendo.
I have seen that Phil Spencer would be a-ok wit them appearing, and props to him for being a cool guy with that, but honestly I think Banjo and Kazooie on a Nintendo console, including Smash is something that will have to be left as a what could have been...