Alright, I'll have a go at this.
I imagine most of the smashers live in their own separate worlds for the most part, but every time a new Smash competition comes around, they get together and stay in a fancy hotel.
The fighting in Smash bros is just friendly competition (for the most part). Master Hand is in charge, and gives invitations to all of the new smashers. Master Hand doesn't stay in the hotel with themhowever, he lives in Final Destination with Crazy Hand. When Master Hand isn't around, Mario is put in charge. Since the fights are mostly friendly competition, most play by the rules. But if anybody gets seriously injured, Mario is ready to be their doctor.
and
share a room. Mario is more of a social butterfly than Luigi, often leaving to spend time with other people. He is friends with almost everybody except for the villains, who he tries to set straight.
Luigi usually sticks to himself when Mario is not around, cooking new dishes or playing with Yoshi. Of course, the two are always ready to save the princess, and Professor E. Gadd has Luigi on call.
In battle, Mario is fair and courteous, and always shakes hands afterward. Luigi is scared of every battle, but always proves himself.
The bros get regular letters from Captain Toad about his adventures. Mario and Luigi really want Toad to move into the smash residence and join the fight. Toad is humble, and a little nervous, but said he'd love to join the fun if Master Hand ever invited him.
is still Mario's closest friend, and sleeps curled up at the foot of Mario's bed. He is a gentle dinosaur who enjoys playing outside with the Pikmin.
and
are good friends and roommates, and sometimes help eachother with their evil-doing. They often bully the other Smashers.
finally convinced his dad to let him live in the Smash residence. He was almost sent home because of how young he is, but he proved himself in battle and was able to stay.
He shares one room with all seven Koopalings. Naturally, things get pretty crazy in there - lots of pillow fights and pranks. Despite the mischief he gets up to, Bowser is very proud of his son.
and
share a room, and spend all day doing eachother's hair and make-up. Peach is more lively and outgoing, while Zelda is more of a introvert. Peach is often kidnapped by Bowser, but Zelda protects her. It is rumoured that Bowser is a little scared of Zelda.
often comes around for slumber parties.
and
share a room. They didn't know each other too well at first, but eventually grew to like training together and telling eachother about their adventures.
Link and Mario are close friends.
,
, and
all used to be very close friends, but Dedede was cut out of the group because he was too much of a jerk. Dedede wanted to join Ganondorf and Bowser in their princess-kidnapping schemes, but the two villains did not take the fat penguin seriously and actually kidnapped him along with the princesses instead. So, Dedede begrudgingly spends time with his fellow royals
and
, but longs to be taken seriously as a 'real' villain.
shares a room with
. Kirby tries to get Meta Knight involved with all of the fun and games, but he mostly just stays inside reading books. Kirby likes to cook for the smashers, though he often eats the dishes before serving.
and
share a room, of course. The two mostly sit around all day eating bananas and playing music. Diddy Kong longs for his girlfriend Dixie to come and join the smashers.
does not live in the Smash residence, because she has the galaxy to protect! She lives in the comet observatory with her huge Luma family, but often comes to visit Mario and the gang. She is also quite close with
,
,
,
,
and
all live in the same room as their trainer,
. Red stopped fighting after he realized these brawls aren't mere Pokemon battles. Charizard continued to fight, but Squirtle and Ivysaur stopped until they were fully evolved. Pikachu is very friendly to everybody. Jigglypuff likes to sing and draw.
and
are lone wolves, with no trainer.
and
are roommates. Despite how often she teases him, Palutena is very protective of Pit. Pit is very grateful for this, but deep down wishes he could be more independent.
Pit sometimes joins Palutena when she goes to the princess's room for a slumber party. He's learned how to do make-up and braid hair for the girls - he pretends he's embarrassed, but secretly, he enjoys it.
is the 'old man' of the group. He spends most of his time wandering around, doing housework. He shares a room with
- the two always talk of the glory days of gaming.
is a total narcissistic womanizer, and is considered to be a jerk by many of the smashers. He tries to hit on most of the ladies, mainly Samus, who rejects his advances every time. She is annoyed that he only sees her as a potential mate, rather than a legitimate opponent in battle.
Captain Falcon has it out for Mario, for 'stealing his racing thunder', but Mario thinks nothing of it.
is a lone wolf. She often disappears from the hotel. Rumour has it that she goes to Final Destination to challenge Crazy Hand to battles.
and
are good friends. Megaman is also quite close with
. Mario and Sonic have a friendly rivalry; they end up competing over everything, but always make up in the end.
Nobody wanted to room with
because of his terrible hygiene. He lives alone with all of his money and treasure. He acts like a tough guy, but deep down, he is sad to be alone. Mario is the only one who makes an effort to be nice.
and
share a room. Olimar writes to his wife and kids every day - one of
's Lumas is kind enough to deliver the mail back to Hocotate. He is also still in touch with his co-worker and best friend, Louie, to whom he sends some of Peach's baked treats. Alph, too, stays in touch with his colleagues back at Koppai - he tells stories from all of his great adventures to Brittany and Charlie.
In his spare time, Olimar takes to gardening. Of course, both Olimar and Alph still have that same bond with the Pikmin, who freely roam the hotel (despite often being squished).
mostly trains the other fighters.
is her closest training buddy.
Doc Louis often shows up to give Mac some advice and to help him size up who he is up against.
shares a room with
. He wants to move into the Animal Crossing town to live a peaceful life, away from the craziness of Hyrule, though he is unsure what his grandma would think.
does exactly what he likes to do in his own game - gardening, catching bugs (he often catches Pikmin), and fishing. Some of the smashers got scared when they saw that he owned an axe, but in reality, Villager wouldn't hurt a fly.
and
share a room.
and
share the room next door. The four are close friends and have great respect for one another. They often hang out and practice sword-fighting with
and
.
and
share a room. They are rivals due to their clashing personalities - they fight a lot, but it never gets too extreme.
left because he couldn't handle living alongside Team Starfox.
rooms with
, despite the fact that Lucas no longer takes part in the fights. Lucas couldn't handle the fighting anymore as he was too emotionally worn out. He somehow convinced Master Hand to allow him to stay, because he couldn't bear to leave his close friend Ness. The two play baseball and practice PSI with each other.
Ness still calls his dad every day, and keeps a framed photograph of him with Paula, Jeff and Poo.
is a loner who tries to be edgy. He says he hates everybody and stays alone in his room.
is the pet. He and the duck are inseparable. Mario often plays frisbee with them in the yard. Despite the fact that they are pets, they are still taken seriously on the battlefield, due to the presence of a mysterious, unseen gunman.
is sort of like the butler. He is always happy to help out, around the hotel or in battle.
no longer stay in the hotel. Master Hand didn't approve of Popo and Nana fighting together because he believed it to be an unfair advantage. He privately told Popo that Nana would have to leave: Popo really wanted to continue fighting, but refused to stay if he cannot be with Nana. So the two now spend time scaling mountains, just like they used to.
Mario was sad to see them go and is trying to talk Master Hand into allowing them back to fight together again.
Chrom lived in the residence for just one day. Master Hand kicked him out for being 'just another swordsman', and quickly replaced him with Lucina. Chrom is still perplexed about this decision to this day.
The Chorus Kids too lived in the residence for a day, but were evicted because they were too loud!
Ridley constantly tries to destroy the hotel to fight/kill everyone, but Master Hand quickly takes care of him. Samus wants to fight Ridley head-on in the battlefield, but Master Hand always sends him away before she has a chance.
King K. Rool constantly threatens DK, saying he will come and take him on in a fight - whoever wins gets all the bananas. DK knows that he is all bark and no bite.
Whew, that was a lot. This is surprisingly fun, I might do more.