Personally I'd go for the following in terms of a roster:
Link
Zelda (without Sheik)
Ganondorf/Dai-Mao/Demon King
Impa (as Sheik's replacement)
Tingle
The four 'cast members' of the original Zelda game (even if Impa was only really mentioned in extra material), plus Tingle obviously, being a spinoff character and one of the most re-occurring characters in the series. I don't personally believe Zelda should have a Sheik transformation for the same reason I wouldn't want Toon Link to return - a Zelda character in Smash should represent every one of their incarnations rather than a specific one. Why do we need Adult Link and Child Link? It should be the one Link, with the best visual and gameplay features of every Link to ever appear. Same goes for Zelda, Ganondorf, Impa and Tingle. All of these five characters are re-incarnated frequently throughout the Zelda multiverse, which as far as I'm concerned makes them the best fit.
If they really wanted to stretch it as well to make the characters into all-encompassing representations of the Zelda series as a whole, they could go out of their way to call Ganondorf Dai-Mao (aka the Demon King) instead and give him some qualities of both Demise and Malladus. The only issue with this is that, although that would appeal to Zelda die-hards, the average gamer still associates 'Ganondorf' with the main enemy of Zelda even though he was reincarnated from Demise and there isn't even one Ganondorf to begin with.
The whole Ganondorf/Dai-Mao thing is probably just wishful thinking on my part, but in general I'd love for them to just represent the series as a whole, as opposed to in Melee which blatantly prioritized OoT/MM and in Brawl which prioritized TWW/TP (and let's face it, pretty much ripped models straight from Twilight Princess). Impa, the Demon King and Zelda as examples have had incredibly differing looks over the years, so the developers could go wild and have some fun making 'best-of' versions which represent a wide span of games but still retain the 'feel' of the character.