If Steve is in, I think his moveset could go one of two ways:
#1: His uniqueness is mainly in the ability to place blocks and set up redstone traps. He’d have a good equipment, enchanted Diamond sword, Shield, bow with tipped arrows and positive potions for drinking.
#2: IMO more interesting, at the beggining of a match you start with wood equipment. You still have blocks you can place, but you need to find materials in them and spend some time with the crafting table to get better equipment and like in minecraft, you have to get Steel equipment before getting the best one, Diamond. The blocks would be in a specific order, Diamond ore being the rarest. You could also place a Brewing stand and make potions, but that would make you vunerable for some time, just like Crafting weapons and armor. I think Steve could also have an XP gauge that fills up with damage taken and dealt and could be used to enchant weapons and armor. If Steve gets to having many potions and enchanted Diamond armor and weapons he’d be close to unstoppable, but he’d need to work his way up to that and be vunerable for a long time, so that would be difficult. If Steve loses a Stock, he keeps his equipment, so he doesn’t have to start over. For his final Smash I imagine building a Wither and riding it as it blasts the stage.