Gentlemen, start your hex editors. If anyone is familiar with image formats/JPEG, I think now would be the time to help.
Someone is working on the images, and has gotten past the encryption, but the image format isn't -quite- JPEG. Here are some sample files from the .bin files posted in this thread that they have decoded:
http://rapidshare.com/files/94947097/brawlscreens.zip.html
IrfanView can even view the Snake one, I think. The issue is that some of them, mainly the colorful ones, are very close to JPEG format. Others, especially the nearly solid black image and solid white image, are strange and don't match the JPEG specification. Presumably it's something crazy Nintendo did, but maybe someone here can help figure it out.
*edit* Here's the JPEG specification (not the JFIF one) if anyone wants it. Appendix B has the most interesting stuff, I think (markers).
http://www.w3.org/Graphics/JPEG/itu-t81.pdf