There's still significant characters not in Smash.
Square Enix has the likes of Sora, Crono, and Slime (fuck you Erdrick, no one knows you)
Capcom does have stuff like MH and Resident Evil and Ace Attorney and Devil May Cry and…
Then there's all the significant non-Japanese game characters that are notable in the industry. Scorpion/Sub-Zero from MK, Doomguy from... Doom, Minecraft which is still stupidly popular, Master Chief, Lara Croft... we could get nuttier with the likes of Crash Bandicoot and Spyro the Dragon. Or shit, anything from Portal/Half-Life.
Or how about characters that are hugely well-known from already repped third party franchises? Tails/Robotnik are weird omissions, for example. Chun-Li is another Street Fighter icon that's lacking, but given Ken I'd probably assume no to this one.
OOOR, how about all the non-Pacman stuff Namco does? Tales of series has the likes of Yuri or Lloyd; Tekken has stuff like Kuma or Heihachi.
We could also get super weird: how about an Atari character, like a space invader? Or a Tetris character? At this point, why the fuck not? XD
Looking into current day I'm slowly convincing myself that Sans/Undertale has a shot at representation in some form or other too, given how it's one of the indies that has had a particularly strong penetration in the Japanese market. And there's also niche stuff like Monokuma that would be super dope and represent another genre of gaming, while also giving some attention to a company that has supported Nintendo for a while (Spike Chunsoft).
Man, Cloud really did break the barrier of what's possible. Then Piranha Plant extended that to the absurd and this is the world we live in now.