I hate to break it to you. But Minecraft is one of the best selling, highest earning, widest reaching, and overall biggest games in history. A Steve inclusion is justified by any metric presented by smash's other 3rd party picks. He's iconic(or rather, the game itself is) It's strongly associated with Nintendo, it's known by many people, and it's had a impact on gaming at large. Why is every triple A game ever open world now? Because Minecraft sold gangbusters for simply giving players ridiculous amounts of freedom, and publishers wanted to cash in on that trend.
It's honestly a lot harder to argue against Steve then it is to argue for him. The points for him make themselves. The only thing that really comes to mind is minecrafts popularity in Japan, which staggered at first. But even then, right now it's huge over there and has been for a couple years.
Personally i'm neutral on the inclusion. I wouldn't care if he's added. I wouldn't care if he isn't added. I do however see all the merits of the inclusion. Chief among them being killing the Box theory completely, consuming the causal appeal so that other inclusions are focused on fan service, and potentially opening an avenue for Banjo at a later point. (Think Cloud's impact in smash 4 on Geno's chances for this game)
Reposting my thoughts on this from another thread
I haven't been talking much on Steve but here's my two cents.
Yes, he's obviously an icon. Minecraft practically created the sandbox genre. Yes, there's an obvious legacy because he was the biggest Indie success, to the point of actually not becoming an Indie anymore. Is he reasonable as a character choice? Sure. Marketing reasons, popularity reasons, bonding even more with Microsoft reasons, etc.
That doesn't stop him from being a bad character in my eyes, though. First, he would be horribly generic. Sword, bow, shield would be key parts to his design, pickaxe (which is admittedly hardly different than a sword in a fighting game) if lucky. Potions and TNT are more interesting potential moves, but TNT would likely be like Snake's mines or Link's bombs, which isn't too unique. Potions have potential, but that would probably be a Side-B option if they don't have him swing an axe or pickaxe or something, and would probably be Harming, which is a little boring.
Asthetically, it's hard to make him work. The biggest thing about is design is being blocky and stiff, but he isn't like Game & Watch where his animations could still be fluid despite being different. You could do a Telltale kind of design, sure, but that's another can of worms.
On top of my percieved movepools and animation issues is the admittedly questionable reputation Minecraft has in the gaming community nowadays. It's more and more considered a negative thing since it went mainstream from what I've seen. Sarcastic joking, little kids game, YouTuber bait, etc. The only game I can think of that has equal or greater universal disdain is Fortnite.
Now, take all this and think of Smash speculation and Smash in general. People don't care as much about relevance and more about liking the character, their games, and what cool crazy things they can do. This is why I don't think he fits here. When people bring up Steve, he's below meme picks like Sans or Shrek; the response is basically universal seething disgust. People enjoyed the game, but there's no attachment to Steve outside of that because he's a blank, unseeable Avatar. The game has a tainted reputation, and there's not much about him that makes him super crazy (think top picks. Skull Kid is a demonic wizard basically, Isaac is an Earthbender, Geno is a puppet with a gun hand, Shantae is half-genie and can use magic and transform, Ridley is a massive evil dragon thing, K. Rool is an alligator with a cannon, Banjo is a tag team duo with various powers, Steve place blocks?, use a pickaxe bow and sword, maybe potions, maybe TNT. None of that stands out like rest). People have a perceived notion that his existence also would endanger Banjo & Kazooie's ability to be playable, and they're infinitely more popular than him, and that adds onto why people would hate his addition. If he got in, he would undoubtedly be the most despised newcomer in Smash history. You thought Isabelle's reaction was bad? This would be orders of magnitude worse.
In short, I just don't think Steve would be a good fit in Smash.