I am ALL for Agumon as a playable character in Smash!!
A big element of Smash Bros. is rivalries, we have Mario vs. Sonic, Link vs. Cloud, Samus vs. Megaman, Donkey Kong vs. Pac-Man, etc., etc. One other rivalry in gaming history is most definitely Pokemon vs. Digimon. Though the games themselves are very very different, one an RPG and the other a digital pet keychain (which I do count as a video game, so you could say Agumon orginated as a game character), the franchises eventually gained a very strong rivalry with their toys, cards, television shows, and eventually video games too. And seeing Pikachu vs. Agumon to represent that rivalry would be perfect. Heck, include digivolution as part of Agumon's active moveset and we could even have a great rivalry with Greymon vs. Charizard!!
And that digivolution as part of Agumon's active moveset is what makes me so excited for the character. Perhaps a gameplay gimmick sort of like Lucario's, or rather, Wario's waft, heh... where as the more time you spend in battle the more you digivolve. Starting as Agumon, then becoming Greymon, then finally MetalGreymon, with WarGreymon as the Final Smash (where we then see in a quick animation the character return to Botamon, then quickly to Koromon, and then back to the standard Agumon). But in order for this character to really work, the moveset ought to stay the same throughout each digivolution, only getting stronger and more powerful along the way. Agumon, Greymon, and MetalGreymon all sharing the same moves, just leveled up versions with each new form. So yeah, like Lucario's Aura or Wario's Waft, it'd be a character that's always evolving through a fight the longer the fight... err... Digivolving.
Along with a Digimon rep, there really should be a rep for the bigger and more culturally important Bandai franchise, Tamagotchi. Perhaps a stage or an Assist Trophy (those little cracked egg keychains are pretty iconic after all, and could make a fun setting for a battle arena). Or perhaps the AT (most likely Mametchi, since that's the Tamagotchi mascot) could involve the little digital pet taking a poop, followed immediately by a FLUSH, which could push opponents off the edge of the stage, hah!
But yeah, Tamagotchi may be the bigger icon, but Digimon is the bigger one in terms of fighting, and in terms of rivalries with Pokemon. Either way, would love to see them both in Smash Bros, especially with Bandai/Namco involved.