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So much here is just...wrong.
For one, Dragon Quest is a
massive series. It is literally the highest selling Japanese series not yet represented in Smash. The entire series has sold 75 million copies, and made a gross revenue of $11.7
billion. That makes it the second highest selling and third highest grossing series for Square Enix (behind Final Fantasy for sales, and Final Fantasy and
****ing Space Invaders for revenue). It's popular enough that there's a rumor in Japan that the Japanese parliament made it illegal to release Dragon Quest games on a weekday due to how many people would call in "sick." How many games are popular enough have real world urban legends about them?
I assume the Square statement you're referring to is actually HMK's interview of a
Disney Executive,
which is detailed here. People such as
@PlayerOneTyler,
who literally worked on Disney Infinity, which had the Keyblade as an item, have also corroborated this information. The process for getting Sora in Smash or to use Kingdom Hearts in other media is:
- Go to Normura and get approval from him because he's the series creator
- Go to Disney and say you got approval, do actual negotiations
- Work alongside Disney to ensure all Kingdom Hearts content is true to the source material
Also, Disney owns all of original characters in Kingdom Hearts. That is a fact.
Also, while Geno has always placed well in ballots, he has never as high as K. Rool or Ridley.
@KMDP can show you that Geno doesn't even crack the Top 10 in terms of supporters for a character in Smash. Support for him largely died down during Sm4sh speculation, and he didn't become a common pick until Ridley and K. Rool were confirmed.
This is a list of characters who placed in the top 10 of a massive Nintendo fan poll in Japan. As you can see, Geno is ranked #9, below many other characters. While Sakurai did say he wanted him in Brawl and Sm4sh, we don't know if he changed his mind and went for a larger series again like he did for Cloud.
Also, Square owns the rights to all original characters and content in Super Mario RPG, so for all intents and purposes Geno is a third party character.
There is more than enough reason to believe that Sora or Erdrick would be the mystery Square Enix rep over Geno, especially because they would be absolutely massive reveals. If Steve and one of those two (particularly Sora) were to be revealed in the final Smash Bros. Direct, it could very well break the internet.